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Why the Blackmores Limited (ASX:BKL) share price is rallying higher

The share price of Blackmores Limited (ASX: BKL) continues on an upward trajectory, gaining 17% in eight days. Despite 3Q18 China sales being disappointing, high hope for 4Q18 has provided some solid support for the share price. China is the most important overseas market for Blackmores, but with counterfeit issues and supply problems, shoppers have lost some of their faith in the brand.  But, the company is working hard to overcome these issues and says that there will be strong growth going forward in China.  

The recent The ABC (Australian Brands in China index) 2018 produced by Monash University and marketing company Digital Crew found that while health and baby formula brands were ranked low due to recent supply issues, beauty products were among the highest ranked products. 

BWX Ltd (ASX: BWX) is under an indicative takeover offer but is also a supplier of beauty products to China, including its highly valued Sukin brand. 

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Motley Fool contributor Rosemary Steinfort has no position in any of the stocks mentioned. The Motley Fool Australia owns shares of and has recommended Blackmores Limited. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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