Deep Dive into Leading Sportswear Companies
Anta Sports Products Limited
Anta remains a top pick in the sportswear sector due to its robust execution and high earnings visibility. The company’s multi-brand strategy, strong brand equity, and solid execution position it well to maintain its leadership in the market. During Double 11, Anta improved its overall discount by 2 percentage points year-over-year, with better retail sales momentum in the current quarter compared to the third quarter of 2024. Despite uncertainties surrounding full-year retail sales targets, the company is on track to meet its profit objectives for 2024. The recommended action for investors is to maintain a BUY stance on Anta with a target price of HK\$120.60.
Li Ning Company Limited
Li Ning is another prominent player in the sportswear industry, known for its focus on enhancing brand appeal and expanding product offerings. The company has demonstrated resilience by achieving significant growth in mass-market segments during major sales events. Li Ning is recommended as a BUY with a target price of HK\$20.40, reflecting an expected upside of 30.1%. The company trades at a relatively attractive P/E ratio of 11.5x for 2024F, indicating its potential for growth.
Shenzhou International Group Holdings Limited
Shenzhou International, a leading manufacturer of sportswear, continues to leverage its strong production capabilities and strategic partnerships with global brands. Despite challenges in retail sales projections, Shenzhou is positioned to capitalize on its manufacturing efficiency and brand collaborations. Analysts recommend a BUY for Shenzhou with a target price of HK\$96.50, representing a 58.2% upside potential. The company maintains a P/E ratio of 11.8x for 2024F, highlighting its value proposition.
Xtep International Holdings Limited
Xtep offers a promising investment opportunity in the sportswear sector, driven by its innovative marketing strategies and expanding product lines. The company has shown remarkable progress in capturing consumer interest through targeted campaigns and product diversification. The recommendation for Xtep is a BUY with a target price of HK\$7.80, indicating a potential upside of 53.5%. Trading at a P/E ratio of 9.8x for 2024F, Xtep presents an attractive investment option.
Conclusion
The sportswear sector in China, while facing certain challenges, offers significant investment opportunities for discerning investors. Anta, Li Ning, Shenzhou, and Xtep stand out as top choices due to their strategic initiatives and market positioning. By maintaining a focus on consumer trends and adapting to market dynamics, these companies are well-equipped to navigate the evolving landscape and deliver strong returns.
