Group 1 - The core viewpoint of the news is that 361 Degrees (361o) has reported positive retail growth across its main brand and children's clothing line for the first quarter of 2025, with significant increases in e-commerce sales as well [1][2] Group 2 - For the main brand, retail sales (in retail value) increased by approximately 10% to 15% compared to the same period in 2024 [1] - The children's clothing brand also saw retail sales (in retail value) grow by 10% to 15% year-on-year [1] - The e-commerce platform experienced a substantial increase in overall sales, recording a growth of 35% to 40% compared to the first quarter of 2024 [1] Group 3 - 361o continues to focus on the mass professional sports sector, leveraging technological innovation and fashion trends to enhance product offerings [2] - New product launches include upgraded running shoes such as "速湃FLOAT2" and "疾风ET," which aim to improve performance and user experience [2] - The "飞燃4" running shoes received the 2025 MUSE Design Award Silver, highlighting the brand's design excellence in competitive running footwear [2] Group 4 - In the basketball segment, the launch of Spencer Dinwiddie's third signature shoe "DVD3" showcases innovative design and performance enhancements [2] - The "BIO BB" basketball shoes won the 2025 MUSE Design Award Gold, reflecting the brand's commitment to quality and performance [2] - The introduction of the "Ultra series" spring apparel aims to enhance user experience with advanced technology and design [2]

Investment Rating - The industry investment rating is "Positive" and maintained [8] Core Insights - The brand sector shows steady recovery in Q1 under consumer promotion policies, with most companies achieving positive growth, outperforming expectations. The performance varies across sub-sectors, with mid-to-high-end menswear showing strong growth, sports retail maintaining steady growth, and mass brands also experiencing a rebound. Profitability varies due to differentiated cost control and operational leverage [2][4][16] - The manufacturing sector faces short-term pressure as downstream inventory has reached healthy levels, but demand from major export countries is weakening. In Q1, demand from the US and Japan shows marginal weakening. Most brands and retailers have returned to healthy inventory levels, but weak overseas demand is expected to limit replenishment momentum, affecting order elasticity in the related supply chain [2][4][17] Summary by Relevant Sections Brand Sector - Q1 retail sales of clothing and textiles increased by 3.3% year-on-year, with a month-on-month increase of 3.6 percentage points [20] - Mid-to-high-end menswear brands are leading in retail growth, while the sports sector continues to show steady growth. Mass apparel brands are also experiencing a recovery [20][27] Manufacturing Sector - The manufacturing sector is under short-term pressure due to weak demand from major export markets and healthy inventory levels. The overall order placement is cautious, with expectations of further pressure from tariff forecasts [4][28] Key Company Performance - **Wanjian Medical**: Expected Q1 revenue growth of 30%-40%, driven by non-woven products and strong brand power in sanitary napkins [5][40] - **Zhejiang Natural**: Anticipated Q1 revenue growth of 25%-35%, with net profit expected to increase by 50%-100% [5][40] - **Weixing Co.**: Expected Q1 revenue growth of 10%-15% and double-digit net profit growth [5][40] - **Anta Sports**: Expected Q1 revenue growth in the high single digits, with FILA brand showing mid-to-low single-digit growth [6][20] - **361 Degrees**: Anticipated Q1 revenue growth of 10%-15% for adult apparel and around 15% for children's clothing, with e-commerce growth of about 20% [6][20] Inventory and Demand Trends - The inventory levels of most brands and retailers have returned to a healthy state, with the wholesale inventory destocking nearing completion. However, weak overseas demand is expected to limit replenishment momentum [4][28]

Investment Rating - The report recommends "Buy" for leading sports brands like Anta Sports and Li Ning, indicating strong operational resilience and growth potential in a challenging retail environment [5][27]. Core Insights - The sports industry demonstrated strong operational resilience in 2024, with major companies like Anta Sports, Li Ning, Xtep International, and 361 Degrees showing varied revenue growth rates of +13.58%, +3.90%, -5.36%, and +19.59% respectively [1][7]. - The report anticipates continued stable growth for leading sports brands in 2025, with projections for Anta's main brand to maintain high single-digit growth and FILA to achieve mid-single-digit growth [13][14]. Summary by Sections Performance Review - Anta Sports and FILA maintained steady operations, with revenue reaching 70.826 billion CNY, while 361 Degrees capitalized on lower-tier markets, achieving a revenue increase of 19.59% to 10.074 billion CNY [1][10]. - Li Ning's revenue remained stable, with a focus on e-commerce and product diversification, leading to a 10.3% increase in online sales [9]. Marketing and Inventory Management - Anta Sports increased its sales expense ratio to 36.21%, reflecting higher investments in new product promotions and channel expansion [2][16]. - Inventory turnover days improved for Xtep International, decreasing by 10 days to 79 days, while 361 Degrees saw an increase in turnover days due to strategic inventory buildup for e-commerce [2][17]. Manufacturing Sector - Major manufacturers like Wah Lee Group and Shenzhou International reported revenue growth of 19.35% and 14.79% respectively, driven by increased demand and efficient operations [3][22]. - The overall profitability of the manufacturing sector improved, with Wah Lee's net profit margin at 15.36% and Shenzhou's gross margin increasing to 28.10% [20][21]. Investment Recommendations - The report suggests that leading sports brands like Anta Sports and Li Ning are well-positioned to outperform the industry due to their operational strengths and market strategies [5][27]. - For the manufacturing sector, Wah Lee Group is recommended as a strong player, with potential for increased market share amid industry consolidation due to external pressures [5][27].

Investment Rating - The report maintains a "Buy" rating for key companies in the sports footwear and apparel sector, specifically recommending Anta Sports, Li Ning, Xtep International, and 361 Degrees [7]. Core Insights - The sports footwear and apparel sector is expected to achieve steady growth in 2024, with a focus on leading companies' long-term investment value [1]. - In 2024, the combined revenue of four Hong Kong-listed sports footwear and apparel companies grew by 9% year-on-year to 123.2 billion yuan, while net profit attributable to shareholders increased by 36.21% to 21 billion yuan [1][11]. - The sector's stock prices have shown volatility but are expected to rise as consumer confidence improves and national policies stimulate demand [1][39]. Summary by Sections 2024 Review - The sports footwear and apparel sector demonstrated stable growth in terminal sales and maintained healthy inventory levels [1][11]. - The combined revenue of key companies in the sector showed consistent growth across the first and second halves of 2024, with a year-on-year increase of 9% [11]. - The inventory turnover days for major companies are healthy, averaging between 4-5 months, setting a solid foundation for growth in 2025 [1][24]. 2025 Outlook - The demand resilience in the sector is expected to continue, with a forecast for steady growth driven by recovering consumer confidence and an increasing preference for functional apparel [2][44]. - The report anticipates a trend of lower growth in the first quarter of 2025, followed by an increase in subsequent quarters, contingent on overall consumer sentiment improving [2][44]. Operational Trends - Companies are focusing on enhancing product quality, optimizing channel operations, and increasing marketing efforts to capture consumer attention [3]. - Key product categories such as running and outdoor gear are driving growth, with notable increases in sales for brands like Li Ning and Saucony [2][3]. - The report highlights the importance of channel optimization and marketing investments, with companies like 361 Degrees sponsoring major events to boost brand visibility [3][44]. Key Company Analysis and Investment Recommendations - Anta Sports is highlighted as a top pick due to its strong performance and expected revenue growth of 10.5% in 2025, with a projected net profit of 13% growth [45][46]. - Li Ning is expected to maintain stable revenue but face a decline in net profit due to prior asset impairments [45]. - Xtep International is projected to grow revenue by 7% and net profit by 10.3% in 2025, benefiting from its focus on professional sports segments [45][46]. - 361 Degrees is anticipated to achieve a 14% revenue increase and a 14.2% rise in net profit, supported by its broad market positioning [45][46].

Core Insights - Li Ning Company reported a 3.9% increase in revenue for the fiscal year 2024, reaching 28.676 billion RMB, with a gross margin improvement to 49.4% and a net profit of 3.013 billion RMB, reflecting a net profit margin of 10.5% [1][5][6] - The company continues to focus on a "single brand, multiple categories, and multiple channels" strategy, with significant investment in product innovation and brand building [1][6] Financial Performance - Revenue from footwear increased by 6.8% to 14.3 billion RMB, contributing 49.9% to total revenue, while apparel revenue decreased by 2.9% to 12.05 billion RMB, contributing 42.0% [2][3] - Equipment and accessories revenue saw a substantial growth of 29.3% to 232.5 million RMB, increasing its contribution to 8.1% [2][3] Market Dynamics - The Chinese market revenue grew by 3.98% to 28.14 billion RMB, while overseas market revenue remained stable at 531 million RMB, accounting for 1.9% of total revenue [5][6] - The number of sales points for Li Ning brand stores decreased by 83 to 7,585, indicating a slight contraction in physical retail presence [5] Competitive Landscape - Anta Group remains the industry leader with a revenue of 70.826 billion RMB, a 13.6% year-on-year increase, and has crossed the 100 billion RMB mark in total revenue when including its subsidiary Amer Sports [1][6] - Xtep achieved a record net profit of 1.238 billion RMB, growing 20.2% year-on-year, while 361 Degrees reported a 19.5% revenue increase, reaching 10.07 billion RMB [1][6] Strategic Focus - Li Ning emphasizes the importance of product innovation, with core running shoe sales surpassing 10.6 million pairs, and increased R&D spending to 676 million RMB, representing 2.4% of total revenue [1][2] - The company is actively optimizing its channel structure, with e-commerce revenue growing by 10.3% to 8.3 billion RMB, while retail channel revenue slightly declined by 0.3% to 6.88 billion RMB [1][4]

Core Viewpoint - The performance of leading domestic sports brands 361°, Xtep, Anta, and Li Ning in their 2024 annual reports exceeded market expectations, marking a significant competition in the "hundred billion" market [1] Group 1: Company Performance - 361° led the industry with a revenue growth of 19.6%, becoming a new member of the "hundred billion first tier" [1] - Xtep achieved a historical net profit of 1.238 billion yuan through strategic restructuring focused on core business [1] - Anta maintained its position as the industry leader with a revenue of 70.8 billion yuan [1] - Li Ning's revenue grew by 3.9% to 28.68 billion yuan, but it faces pressure from slowing growth [1] Group 2: Market Dynamics - The year 2024 is highlighted as a "sports year" with major international events like the Paris Olympics and the European Cup, boosting the sports goods market [1] - Major brands are leveraging event marketing to capture consumer attention [1] Group 3: Strategic Approaches - Anta employs a multi-brand strategy to cover high-end outdoor and mass markets, while Li Ning focuses on "sports fashion" to enhance premium capabilities [3] - Xtep concentrates on its main brand and Saucony to solidify its professional running segment [3] - 361° utilizes a "three innovations" strategy—technology, channel, and event innovation—to break into the mass market [3] Group 4: Financial Insights - 361° reported a 22.58% growth in main brand revenue and a 19.5% increase in children's business revenue, with e-commerce maintaining double-digit growth [4] - The company invests 3%-4% of its revenue in R&D, supporting innovations like CQT carbon critical technology [4] Group 5: Competitive Landscape - Domestic sports brands have surpassed international brands in overall revenue, with Anta, Li Ning, Xtep, and 361° collectively generating over 123 billion yuan, compared to Nike and Adidas's combined revenue of about 75 billion yuan [6] - Despite this, international brands maintain a structural advantage in the high-end market, with Nike and Adidas holding over 50% market share in the 800 yuan and above price segment [7] Group 6: Future Outlook - The sports industry remains a key focus for national development, entering a phase of "high-quality development" [7] - Companies that leverage technological innovation, optimize consumer experience through scenario innovation, and expand globally are expected to achieve further growth [7]

Financial Performance - Revenue increased by 19.6% to RMB 10.07 billion[16] - Profit attributable to equity holders increased by 19.5% to RMB 1.15 billion[16] - Basic earnings per share increased by 19.5% to RMB 0.556[16] - The company achieved revenue of RMB 10,073.5 million for the fiscal year 2024, representing a year-on-year growth of 19.6%[23] - Profit attributable to equity holders reached RMB 1,148.6 million, an increase of 19.5% compared to the previous year[23] - The gross profit margin improved to 41.5% in 2024, up from 41.1% in 2023[22] - The operating profit margin decreased slightly to 15.6% in 2024 from 16.4% in 2023[22] - Total revenue for the year ended December 31, 2024, reached RMB 10,073.51 million, representing a 19.6% increase from RMB 8,423.26 million in 2023[115] Dividend and Shareholder Returns - Final dividend declared at HKD 0.10, equivalent to RMB 0.096, with a payout ratio of 45.0%[16] - The proposed final dividend for the year ending December 31, 2024, is HKD 0.10 per share, compared to HKD 0.139 per share in 2023[181] - The interim dividend declared was HKD 0.165 per share, an increase from HKD 0.065 per share in 2023[181] - The total reserves available for distribution to equity shareholders as of December 31, 2024, was approximately RMB 698,189,000, down from RMB 1,260,420,000 in 2023[181] Store and Outlet Expansion - Total number of 361º stores in mainland China reached 5,750[17] - Total number of 361º children's sales outlets in mainland China reached 2,548[17] - Total number of international sales outlets for 361º reached 1,365[17] - The company operates 5,750 stores in China, with an average store size of 149 square meters, an increase of 11 square meters from the end of 2023[32] - The company has established 1,365 offline sales outlets overseas, marking significant progress in its international market expansion[33] E-commerce Performance - E-commerce business revenue grew by 12.2% to RMB 2.61 billion[16] - The e-commerce segment generated revenue of RMB 2,609.4 million, accounting for approximately 25.9% of total revenue, with a year-on-year growth of 12.2%[97] - During the "618" shopping festival, e-commerce sales increased by 99%, achieving the highest growth rate in the industry, with over 240,000 units sold across all channels, a year-on-year increase of 167%[100] Marketing and Sponsorship - The company secured sponsorship rights for major international events, including the 2025 Asian Winter Games and the 2026 Asian Games, enhancing brand visibility[25] - The company supported 117 major marathon events in 2024, helping athletes achieve 114 podium finishes, including 76 first places, 23 second places, and 15 third places[26] - The company has become the exclusive sponsor of the 2024 Asian Jump Rope Championship and the National Jump Rope League, reinforcing its commitment to youth sports development[30] - The brand signed NBA star Kentavious Caldwell-Pope, becoming the fourth international basketball ambassador, enhancing its global brand presence[64] Product Development and Innovation - The company emphasized a strategy focused on "technology-based, brand-first" development to enhance competitive advantage[24] - The company has developed a series of innovative outdoor products that integrate functionality and technology, targeting the growing outdoor market and appealing to younger consumers[28] - The company launched the "JOKER 1" signature shoe in collaboration with Nikola Jokić, enhancing its brand influence through various interactive consumer engagement activities[27] - The company launched new products such as the "Drift 1.0 and 2.0" basketball shoes and upgraded technologies in children's running shoes, enhancing the product matrix[83] Research and Development - Research and development expenses were 3.4% of revenue in 2024, down from 3.7% in 2023[22] - The company holds 633 patents as of December 31, 2024, an increase of 139 from the previous year, reflecting its focus on technological innovation[31] - The company’s R&D expenditure accounted for 3.4% of total revenue, focusing on continuous upgrades in running and basketball product lines[102] Market Trends and Economic Environment - In 2024, China's GDP reached RMB 13,490.84 billion, growing by 5.0% year-on-year, indicating a steady economic recovery[38] - The total retail sales of consumer goods in China amounted to RMB 48,789.5 billion in 2024, with a year-on-year growth of 3.5%[38] - The domestic sports goods market is experiencing rapid growth, particularly in children's sports apparel and footwear, driven by increased government support and consumer demand[46] Corporate Social Responsibility - The company received the "2024 ESG Leading Enterprise Award" in September 2024, highlighting its commitment to sustainable development[113] - The company actively contributed to social responsibility by donating RMB 8 million in winter supplies to earthquake-affected areas in January 2025[113] Financial Position and Liquidity - The company maintained a current ratio of 3.6 in 2024, indicating strong liquidity[22] - Cash and cash equivalents increased to RMB 4,254.2 million as of December 31, 2024, from RMB 3,596.5 million in 2023, attributed to strategic inventory increases[136] - Total assets increased to RMB 13,413.6 million, up from RMB 13,065.3 million, with total liabilities at RMB 3,584.4 million[141] Employee and Management Information - The company employs a total of 7,934 full-time employees in China as of December 31, 2024[153] - The company has obtained insurance for directors against potential third-party liabilities incurred while performing their duties[191] Strategic Partnerships and Collaborations - The company has established a long-term strategic partnership with supply chain enterprises to enhance production stability and quality[101] - The company has engaged multiple athletes as brand ambassadors, achieving notable placements in various marathons[73][75][76]

Investment Rating - The report maintains a "Recommended" rating for the textile and apparel industry [1]. Core Insights - The leading domestic sports brands, including Anta Sports, Xtep International, and 361 Degrees, have shown resilient growth in 2024, with revenues of 70.826 billion, 13.577 billion, and 10.074 billion yuan respectively, reflecting year-on-year growth rates of 13.6%, 6.5%, and 19.6% [3][6]. - The retail sales of clothing in China for January-February 2025 reached 262.4 billion yuan, a year-on-year increase of 3.3%, indicating a steady recovery in consumer demand supported by favorable policies [7][15]. - The report anticipates a quarterly improvement in clothing consumption throughout 2025, driven by ongoing consumer policy support and the effects of a low base in 2024 [7][15]. Summary by Sections 1. Industry Overview - The textile and apparel industry is experiencing stable growth, with a focus on domestic consumption recovery in early 2025 [1]. 2. Key Industry Data Review (a) Stock Market Review - The Shanghai Composite Index fell by 1.6%, while the textile and apparel sector saw a decline of 1.29% during the week of March 17-21, 2025 [11][12]. (b) Retail Performance - The total retail sales of consumer goods in China for January-February 2025 amounted to 83,731 billion yuan, with clothing retail sales contributing 2,624 billion yuan [15]. (c) Upstream Textile Exports - In February 2025, textile yarn, fabric, and related products exported amounted to 6.219 billion USD, a year-on-year decrease of 25.3% [22]. (d) Upstream Raw Materials - As of March 21, 2025, the domestic cotton price index was 14,905 yuan per ton, showing a slight increase from the previous week [31][32]. 3. Key Company Announcements - Anta Sports, Xtep International, and 361 Degrees reported significant revenue growth for 2024, with net profits increasing by 52.4%, 20.2%, and 19.5% respectively [3][6].

Investment Rating - The investment rating for the company is "Outperform the Market" [2] Core Views - The company is expected to achieve significant revenue growth driven by volume increases in both adult and children's footwear and apparel, with a projected revenue increase of 19.6% to 10.074 billion yuan in 2024 [6] - The company has shown a stable profit level, with net profit expected to grow by 19.5% to 1.149 billion yuan in 2024, maintaining a net profit margin of 11.4% [6] - The company is focusing on expanding its store network and optimizing its channel structure, with a particular emphasis on the new "super product" stores aimed at capturing market opportunities [6] Financial Summary - Revenue projections for the company are as follows: - 2023: 8.423 billion yuan - 2024: 10.074 billion yuan - 2025E: 11.486 billion yuan - 2026E: 12.914 billion yuan - 2027E: 14.355 billion yuan - Year-over-year revenue growth rates are projected at 21.0% for 2023, 19.6% for 2024, 14.0% for 2025, 12.4% for 2026, and 11.2% for 2027 [5] - Net profit projections are as follows: - 2023: 961 million yuan - 2024: 1.149 billion yuan - 2025E: 1.292 billion yuan - 2026E: 1.501 billion yuan - 2027E: 1.672 billion yuan - Year-over-year net profit growth rates are projected at 28.7% for 2023, 19.5% for 2024, 12.5% for 2025, 16.2% for 2026, and 11.3% for 2027 [5] - The company plans to pay a final dividend of 0.10 HKD per share, with a total payout ratio of 45%, an increase of 4.8 percentage points year-over-year [6] Market Performance - The company's stock closed at 4.52 HKD on March 24, 2025, with a 52-week price range of 3.02-4.98 HKD [2] - The company has shown an absolute price increase of 13.3% over the past month and a relative increase of 10.9% compared to the Hang Seng Index [4] Strategic Initiatives - The company is expanding its online sales channels, with e-commerce revenue expected to grow by 12.2% in 2024, while also making progress in overseas market development [6] - The introduction of new product lines and the optimization of the store network are expected to enhance store efficiency significantly [6]

Investment Rating - The investment rating for the company is "Buy" and is maintained [6]. Core Views - The company reported a revenue of 10.07 billion in 2024, representing a year-on-year increase of 19.6%, and a net profit attributable to shareholders of 1.15 billion, also up by 19.5%. The dividend payout ratio increased to 45% [2][4]. - For the second half of 2024, the company achieved a revenue of 4.93 billion, a year-on-year growth of 20.0%, with a net profit of 360 million, marking a significant increase of 39.2% [2][4]. - The revenue performance met expectations, while the profit performance slightly exceeded expectations [2][4]. Summary by Sections Financial Performance - In 2024, the company achieved a total revenue of 10.07 billion, with a year-on-year growth of 19.6%. The net profit attributable to shareholders was 1.15 billion, also reflecting a growth of 19.5%. The dividend payout ratio was raised to 45% [2][4]. - The second half of 2024 saw revenues of 4.93 billion, up 20.0% year-on-year, and a net profit of 360 million, which is a 39.2% increase compared to the previous year [2][4]. Future Outlook - The company is exploring new business models, with the opening of "super stores" expected to contribute to future retail growth. The first super store opened in Shijiazhuang, Hebei, with plans for further openings in Huizhou, Guangdong, Chengdu, Sichuan, and Nanning, Guangxi [8]. - The company anticipates strong performance in the first three quarters of 2025, with a high certainty of continued revenue growth. The product matrix is improving, and the channel structure is being optimized [8]. Profit Forecast and Valuation - The company is projected to achieve net profits of 1.31 billion, 1.48 billion, and 1.65 billion for 2025, 2026, and 2027 respectively, with corresponding P/E ratios of 6.69, 5.93, and 5.31, which are significantly lower than other sports goods companies [10].