Key Takeaways from Indonesia Site Visit

研报英文原文证据摘录

Key Takeaways from Indonesia Site Visit

UpdateM

The company's emphasis on localization rather than simply transplanting products from

Japan also contributes to its competitive advantage. Examples include offering smaller

product sizes than those sold in Japan to improve affordability for local consumers, and

developing formulations tailored for halal compliance while maintaining the quality and

user experience associated with global brands.

Hada Labo remains a key growth driver (10-year sales CAGR of 39% and 5-year CAGR of

44%). In F3/26, sales more than doubled YoY. While the overall market also appears to

have grown significantly due to new product launches by various companies, management

indicated that the combination of product quality, affordability, and revamped social media

communications that increased brand awareness drove the strong performance. The

company stated that its market share increased as a result. It is also planning revenue

growth in F3/27 despite the high comparison base.

Other observations from discussions with local management: Local management

appears to have relatively broad decision-making authority. Examples include the

development of local products for eye drops and Hada Labo. On the sales side, authority

has also been delegated to Indonesia's 26 regional branches, allowing the company to

tailor marketing initiatives to local characteristics (including the country's multilingual

nature), which likely contributes to its agile sales capabilities. We also learned that Rohto's

overseas operations regularly share information and know-how and discuss business

collaborations. (In manufacturing, the fact that eye-drop production lines are based on a

common group-wide (Japanese-designed) platform reportedly generates maintenance