Group 1 - The stock of Tmall (06110.HK) has dropped over 5%, currently down 5.17% at 3.3 HKD [1] - The trading volume reached 21.1841 million HKD [1]

Core Viewpoint - The company Tmall (滔搏) reported a decline in revenue and profit for the six months ending August 31, 2025, indicating ongoing challenges in its retail and wholesale business [1] Financial Performance - Revenue for the period was approximately 12.2986 billion yuan, a year-on-year decrease of 5.79% [1] - Profit attributable to equity holders was about 789 million yuan, down 9.69% year-on-year [1] - Earnings per share were 12.72 cents, with an interim dividend of 13 cents compared to 14 cents in the same period last year [1] Sales and Market Trends - The total sales amount for the retail and wholesale business in the second quarter of the fiscal year 2025/26 experienced a high single-digit decline year-on-year [1] - The company is expected to face continued sales pressure in the first half of fiscal year 2026, although cost control measures have shown positive effects [1] Margin and Cost Control - Gross margin slightly decreased by 0.1 percentage points to 41.0%, impacted by changes in discounts and an increase in online revenue share [1] - The contribution from retail business and support from brand partners partially offset negative impacts on gross margin [1] Future Outlook - The company anticipates clearer signs of recovery in the second half of the fiscal year [1] - The interim payout ratio was 102%, with an expected dividend yield close to 7%, which may provide downside protection for the company's stock price [1]

Core Insights - The company reported a decline in revenue and net profit for the first half of the 2026 fiscal year, with revenue at 12.3 billion RMB, down 5.8% year-on-year, and net profit at 790 million RMB, down 9.7% year-on-year [1][2] Financial Performance - Earnings per share (EPS) for the period was 0.13 RMB, with a proposed interim dividend of 0.13 RMB per share, resulting in a payout ratio of 102.2% [1] - The gross profit margin decreased by 0.1 percentage points to 41.0%, while the operating profit margin fell by 0.5 percentage points to 8.1%, and the net profit margin declined by 0.3 percentage points to 6.4% [1][2] Sales and Revenue Breakdown - Revenue from the main brands (Nike and Adidas) and retail business decreased by 4.8% and 3.0% respectively, with total store count decreasing by 332 [1] - Revenue contributions by brand for the first half of 2026 were 87.9% from main brands, 11.5% from other brands, 0.5% from joint venture income, and 0.1% from esports, with respective year-on-year changes of -4.8%, -12.2%, -15.2%, and -39.7% [1] Channel Performance - Revenue by channel showed retail and wholesale income down by 3.0% and 20.3% respectively, with retail accounting for 86.2% of total revenue [2] - The total number of stores decreased to 4,688, with a total sales area down 14.1% year-on-year, while the average sales area per store increased by 6.5% [2] Inventory and Cash Flow - Inventory as of August 2025 decreased by 2.8% quarter-on-quarter to 5.83 billion RMB, down 4.7% year-on-year, with inventory turnover days increasing to 150 days [3] - Operating net cash flow for the first half of 2026 decreased by 48.2% to 1.35 billion RMB [3] Strategic Initiatives - The company is focusing on enhancing its retail operations and optimizing its offline store network while expanding its online presence [3] - New partnerships have been established with running brands and outdoor brands, and a new running concept store has been opened [3] Profit Forecast Adjustments - Due to uncertainties in terminal demand, the company has slightly lowered its profit forecasts for fiscal years 2026 to 2028, with net profit estimates reduced by 5% for 2026 and 6% for 2028 [3]

Core Viewpoint - The company reported a decline in revenue and net profit for FY2026H1, with revenue at 12.299 billion yuan, net profit at 789 million yuan, and operating cash flow at 1.355 billion yuan, reflecting year-on-year decreases of 5.8%, 9.7%, and 48.2% respectively, primarily due to a slight decrease in gross margin, increased management expense ratio, and a decline in other income [1][2] Financial Performance - Revenue and net profit for FY2026H1 were 12.299 billion yuan and 789 million yuan, respectively, with a year-on-year decline of 5.8% and 9.7% [1] - Operating cash flow decreased by 48.2% to 1.355 billion yuan, attributed to an increase in accounts receivable and a decrease in accounts payable [1] - The proposed cash dividend per share is 0.13 yuan, with a payout ratio of 102% and a dividend yield of 8.52% [1] Business Segments - Retail and wholesale revenues were 10.925 billion yuan and 2.035 billion yuan, showing year-on-year declines of 3% and 20% respectively, with a more significant drop in wholesale due to inventory reduction and decreased orders [1] - Main brand revenue decreased by 4.8% to 10.812 billion yuan, while other brands, joint venture fees, and esports revenue saw declines of 12.2%, 15.2%, and 39.7% respectively [1] - The number of stores decreased by 19.4% to 4,688, with a net reduction of 332 stores, while the average sales area per store increased by 6.5% [1] Online and Offline Strategy - The company has adopted a comprehensive online strategy combining platform e-commerce, content e-commerce, and private domain operations, achieving double-digit growth in online retail sales [1] - The company is enhancing its store experience by integrating functional services and social attributes, with initiatives like pop-up stores and collaborations with major brands [1] - The company has opened its first running specialty store, ektos, in Shanghai, focusing on runner needs to increase customer loyalty [1] Inventory and Cash Flow Management - Inventory decreased by 4.7% to 5.83 billion yuan, with inventory turnover days increasing by 2 days to 150 days [2] - Accounts receivable decreased by 1.5% to 930 million yuan, with turnover days decreasing by 4 days to 13 days [2] - Accounts payable decreased significantly by 64% to 300 million yuan, with turnover days down by 7 days to 8 days [2] Future Outlook - Short-term improvements in inventory and a comprehensive online strategy are expected to boost online revenue and compensate for offline traffic declines [2] - Mid-term prospects include potential growth from partnerships with high-end running and outdoor brands [2] - Long-term outlook remains positive due to strong channel partnerships, ongoing digital transformation, and high dividend attributes [2]

Core Viewpoint - Tmall's stock price dropped over 5% following the announcement of its interim results, indicating ongoing challenges in sales and profitability [1] Financial Performance - For the six months ending August 31, 2025, the company reported revenue of approximately 12.2986 billion, a year-on-year decrease of 5.79% [1] - The profit attributable to equity holders was about 789 million, down 9.69% year-on-year [1] - Earnings per share were reported at 12.72 cents, with an interim dividend of 13 cents compared to 14 cents in the same period last year [1] Sales and Market Trends - In the second quarter of the fiscal year 2025/26, the total sales amount for the group's retail and wholesale business experienced a high single-digit decline year-on-year [1] - The company is expected to face continued sales pressure in the first half of fiscal year 2026, although cost control measures have shown positive effects [1] Profitability and Cost Management - The gross profit margin slightly decreased by 0.1 percentage points to 41.0%, impacted by changes in discounts and an increase in online revenue share [1] - The contribution from retail business and support from brand partners partially offset negative impacts on profitability [1] Future Outlook - The company is anticipated to show clearer signs of recovery in the second half of the fiscal year [1] - The interim payout ratio was 102%, with an expected dividend yield close to 7%, which may provide downside protection for the stock price [1]

Investment Rating - The report maintains a "Neutral" rating for the company, with a target price of HKD 2.98, indicating a potential downside of 14.4% from the current price of HKD 3.48 [1][2][11]. Core Insights - The company is experiencing sales pressure in the first half of the 2026 fiscal year, with a revenue of RMB 12.3 billion, reflecting a year-on-year decline of 5.8%. This decline is attributed to fluctuations in consumer demand for sports products and foot traffic in physical stores [6]. - Despite operational challenges, the company has managed to control gross margin and expense ratios effectively, with a gross margin of 41.0% and a net profit margin of 6.4% for the first half of the fiscal year [6]. - The management has set guidance for the full year, aiming for net profit to remain flat year-on-year, with expectations for improved net profit margins [6]. Financial Overview - Revenue projections show a decline from RMB 28,933 million in 2024 to RMB 25,856 million in 2026E, with a year-on-year growth rate of -6.6% in 2025 [5][13]. - Net profit is expected to recover slightly from RMB 1,285 million in 2025 to RMB 1,299 million in 2026E, with a net profit margin of 5.0% [5][14]. - The company has a dividend yield of 6.6% for 2026E, which is expected to provide some downside protection for the stock price [6]. Brand Performance and Strategy - The main brand's performance has shown resilience, with a decline of 4.8% compared to a 12.2% drop in other brands. The company is focusing on optimizing brand structure and enhancing online and offline channel management [6]. - The company plans to deepen its focus on running and outdoor segments, with new brand developments and the opening of the first ektos running store [6]. Store and Online Strategy - The company continues to adjust its store structure, with a net reduction of 332 direct stores to 4,688 as of August 2025, and a total sales area decrease of 14.1% [6]. - Online retail business has seen double-digit growth year-on-year, indicating a shift towards a more integrated retail model combining offline and online strategies [6].

Core Viewpoint - The report from Guosheng Securities indicates that Taobo (06110), a leading domestic sports footwear and apparel retailer, has advanced digital capabilities and improved operational efficiency, although short-term sales are impacted by consumer environment and foot traffic fluctuations. The company is expected to achieve net profits of 1.301 billion, 1.483 billion, and 1.648 billion yuan for FY2026-FY2028, with a current price corresponding to a FY2026 PE of 15 times, maintaining a "Buy" rating [1]. Financial Performance - For FY2026H1, the company's revenue decreased by 5.8% year-on-year to 12.3 billion yuan, with a slight decline in gross margin by 0.1 percentage points to 41%. The net profit attributable to shareholders fell by 9.7% to 790 million yuan, with a net profit margin down by 0.3 percentage points to 6.4%. The company declared an interim dividend of 0.13 yuan per share, with a payout ratio of 102.2%, emphasizing shareholder returns [2]. Brand Performance - The main brand Nike is expected to improve, while the company continues to expand brand partnerships for long-term growth. In FY2026H1, revenue from the main brand and other brands decreased by 4.8% and 12.2% to 10.8 billion and 1.4 billion yuan, respectively. Adidas showed a 7.8% revenue growth in the Greater China region, while Nike's revenue declined by 10% [3]. Business Model Analysis - Retail business outperformed wholesale, with e-commerce showing better performance than offline sales. Retail revenue in FY2026H1 fell by 3% to 10.6 billion yuan, while wholesale revenue dropped by 20.3% to 1.6 billion yuan. The company closed 332 stores, optimizing its channel structure, and the total sales area decreased by 14.1% [4]. E-commerce and User Engagement - The company's e-commerce sales grew rapidly, with a double-digit increase in FY2026H1. The company is enhancing its e-commerce capabilities by leveraging offline stores and expanding into various online channels. The total number of members reached 89.1 million, with member contributions accounting for 92.9% of retail sales from offline stores and WeChat mini-programs [5]. Inventory and Cash Flow - As of August 2025, the company's inventory stood at 5.83 billion yuan, down 4.7% year-on-year, with inventory turnover days at 150 days, an increase of 1.7 days. The net cash flow from operating activities was 1.35 billion yuan, 1.7 times the net profit attributable to shareholders, indicating strong cash flow management [6]. Future Outlook - For FY2026, the company is expected to see a slight decline in revenue, with net profit remaining stable year-on-year. The ongoing fluctuations in offline foot traffic and faster online growth are considered in this outlook [7][8].

Core Viewpoint - The report from Guosheng Securities indicates that Taobo (06110), a leading domestic sports footwear and apparel retailer, has advanced digital capabilities and improved operational efficiency. However, short-term impacts from the consumer environment and foot traffic fluctuations have affected terminal sales. The firm forecasts net profits attributable to the parent company for FY2026-FY2028 to be 1.301 billion, 1.483 billion, and 1.648 billion yuan respectively, with a current price corresponding to a FY2026 PE of 15 times, maintaining a "Buy" rating [1]. Financial Performance - For FY2026H1, the company's revenue decreased by 5.8% year-on-year to 12.3 billion yuan, with a slight decline in gross margin by 0.1 percentage points to 41%. The deepening retail discounts negatively impacted gross margin, while the increase in retail business proportion and support from brand partners provided positive contributions. The net profit attributable to the parent company fell by 9.7% year-on-year to 790 million yuan, with a net profit margin decrease of 0.3 percentage points to 6.4%, maintaining relative stability in profit margins. The board has declared an interim dividend of 0.13 yuan per share, with a payout ratio of 102.2%, emphasizing shareholder returns [1]. Brand Performance - The main brand Nike's performance is expected to improve, while the company continues to expand brand partnerships for long-term stable growth. In FY2026H1, revenue from the main brand and other brands decreased by 4.8% and 12.2% to 10.8 billion and 1.4 billion yuan respectively. Adidas is expected to perform relatively well in the Greater China region, with a reported revenue growth of 7.8% for H1 2025 (currency neutral), while Nike's revenue in the same region declined by 10% for FY2026Q1 (currency neutral). The company is also focusing on deepening its brand layout in running and outdoor segments, collaborating with brands like Norda, Soar, Ciele, and Norr na to meet differentiated consumer demands [1]. Business Model Analysis - Retail business outperformed wholesale business, with e-commerce performing better than offline sales. In FY2026H1, retail revenue decreased by 3% to 10.6 billion yuan, with offline stores undergoing optimization and same-store traffic declining by double digits. Conversely, online retail sales grew by double digits. Wholesale revenue fell by 20.3% to 1.6 billion yuan, primarily due to reduced orders from offline channels caused by foot traffic fluctuations. The company closed 332 offline stores, optimizing its channel structure, resulting in a total of 4,688 stores as of the end of August 2025, with total sales area down by 14.1% but same-store sales area up by 6.5% [2]. E-commerce Growth - The company's e-commerce platform sales grew rapidly, demonstrating excellent omnichannel e-commerce operational capabilities. In FY2026H1, retail online sales, including both public and private domains, achieved double-digit growth. The company continues to strengthen its e-commerce system, leveraging offline stores to extend online boundaries and building channels such as Douyin live streaming, Xiaohongshu, WeChat mini-programs, and instant retail. Additionally, the company is enhancing its refined operational capabilities in platform e-commerce and content e-commerce [2]. Consumer Focus - The company is consumer-centric, focusing on user operations. As of the end of August 2025, the total number of members reached 89.1 million, with a continuous expansion of the membership base. During the same period, the retail total from offline stores and WeChat mini-programs contributed 92.9% of total sales, with repeat member sales accounting for 60% of overall sales, maintaining a high and stable sales contribution [3]. Inventory and Cash Flow - The inventory situation is stable, with a cash flow return that is excellent. As of the end of August 2025, the company's inventory amounted to 5.83 billion yuan, down by 4.7% year-on-year, with inventory turnover days at 150 days, an increase of 1.7 days year-on-year. The company has effectively controlled its total inventory. The net cash flow generated from operating activities during the period was 1.35 billion yuan, 1.7 times the net profit attributable to the parent company, indicating a healthy cash return capability in an uncertain market environment [4]. Future Outlook - For FY2026, the firm expects a slight decline in revenue, with net profit attributable to the parent company remaining roughly stable year-on-year. The company anticipates continued fluctuations in offline foot traffic, while online growth is expected to accelerate. Overall, considering the fluctuations in the consumer environment, the company forecasts a slight decline in revenue for FY2026, with net profit remaining stable year-on-year [5][6].

Core Viewpoint - 中金 maintains a "outperform" rating for 滔搏 (06110) with an adjusted target price of HKD 4.17, reflecting a 23% increase and corresponding to 18/15 times FY26/27 earnings multiples, indicating a 20% upside potential [1] Financial Performance - For 1HFY26 (March-August 2025), the company reported a revenue decline of 6% year-on-year to RMB 12.3 billion and a net profit drop of 10% to RMB 800 million, aligning with expectations [1] - The company declared an interim dividend of RMB 0.13 per share, resulting in a payout ratio of approximately 102% [1] Revenue Breakdown - Revenue from direct sales and wholesale decreased by 3% and 20% respectively in 1HFY26 [2] - The main brands, Nike and Adidas, saw a revenue decline of 5%, accounting for 88% of total revenue, while other brands experienced a 12% drop [1][2] Operational Efficiency - The company operated 4,688 direct stores, a reduction of 332 stores since the beginning of the fiscal year, with same-store sales area increasing by 6.5% year-on-year [2] - The company is focusing on optimizing retail stores and has introduced innovative retail formats, such as the running specialty store, ektos, in Shanghai [2] Profitability and Cost Control - The gross margin slightly decreased by 0.1 percentage points to 41% due to a higher proportion of promotional online sales and increased retail share [3] - The overall expense ratio only increased by 0.1 percentage points to 33.2%, despite the revenue decline [3] - The net profit margin decreased by 0.3 percentage points to 6.4% with a net profit decline of 9.8% [3] Inventory and Cash Flow Management - The company effectively managed inventory, with a 4.7% decrease in inventory levels by the end of August [4] - Operating cash flow for 1HFY25 was RMB 1.35 billion, with a net cash ratio of approximately 1.7, supporting a high dividend payout ratio of 102% [4] Future Outlook - Management indicated that retail performance in September-October aligns with 2QFY26, focusing on profit maintenance and aiming for flat net profit year-on-year for FY26, with an improvement in net profit margin [5]

Core Viewpoint - 中金 maintains a "outperform" rating for 滔搏 (06110) with FY26/27 EPS estimates of 0.21/0.26 HKD, and raises the target price by 23% to 4.17 HKD, indicating a potential upside of 20% based on the adjusted valuation multiples [1] Financial Performance - For 1HFY26 (March-August 2025), the company reported a revenue decline of 6% year-on-year to 12.3 billion HKD and a net profit drop of 10% to 800 million HKD, aligning with expectations [2] - The company declared an interim dividend of 0.13 HKD per share, resulting in a payout ratio of approximately 102% [2] - Revenue was impacted by fluctuations in terminal retail, with the company focusing on optimizing offline channels and expanding online retail operations [2] - Revenue for the main brands Nike and Adidas fell by 5%, accounting for 88% of total revenue, while other brands saw a 12% decline [2] Gross Margin and Cost Control - The gross margin for 1HFY26 slightly decreased by 0.1 percentage points to 41%, attributed to a higher proportion of promotional online sales and increased retail share [3] - The overall expense ratio only increased by 0.1 percentage points to 33.2% due to effective cost management despite revenue decline [3] - The net profit margin for 1HFY26 was 6.4%, down by 0.3 percentage points year-on-year [3] Inventory Management and Cash Flow - The company effectively managed inventory, with a 4.7% year-on-year decrease in inventory levels by the end of August [4] - Operating cash flow for 1HFY25 was 1.35 billion HKD, with a net cash ratio of approximately 1.7, supporting the high dividend payout [4] Future Outlook - Management indicated that terminal retail trends in September-October are consistent with 2QFY26, focusing on profit maintenance for FY26 with guidance for stable net profit and improved net profit margin [5]