Investment Rating - The industry maintains a rating of "Add" [6] Core Viewpoints - The textile and apparel industry is expected to recover in 2024, with a focus on quality brands in 2025. The apparel brands are projected to face profit pressure in 2024, with a slight improvement anticipated in Q1 2025 [1][4] - The textile manufacturing sector shows stable growth, with a significant profit increase driven by improved capacity utilization. The impact of recent tariff changes may accelerate industry optimization in the medium to long term [2][4] - The gold and jewelry sector exhibits performance divergence, with brands that focus on store expansion and product differentiation outperforming the industry average [3][4] Summary by Sections 1. Apparel Brands - In 2024, the revenue of key apparel companies (A-shares only) is expected to decline by 2.2%, with a net profit drop of 24.1%. The decline in profit is more significant than revenue due to negative operating leverage and increased expense ratios [1][21] - The gross margin for key apparel companies is projected to increase by 0.4 percentage points to 56.8% in 2024, with a further increase of 1.1 percentage points to 57.4% in Q1 2025 [1][33] - Cash flow for most brands in 2024 is expected to align with performance, maintaining a high dividend payout ratio [1][49] 2. Textile Manufacturing - The textile manufacturing sector is projected to see a revenue increase of 6.4% and a net profit growth of 26.9% in 2024, with leading companies like Shenzhou International and Huayi Group showing revenue growth rates of 15% and 19% respectively [2][4] - The revenue growth for key textile manufacturing companies is expected to slow down in Q4 2024 and Q1 2025 due to high base effects, but overall performance remains stable [2][4] - The sector is expected to benefit from a more integrated and internationalized supply chain, particularly for leading companies [2][4] 3. Gold and Jewelry - The gold and jewelry sector is expected to see a revenue decline of 1.7% in 2024, with a net profit increase of 3.6%. Companies with strong product differentiation and store expansion strategies are likely to outperform [3][4] - The consumption of gold jewelry is projected to decrease by 25% in 2024, while the demand for gold bars and coins is expected to rise by 25% [3][4] 4. Investment Recommendations - For apparel brands, recommended stocks include Anta Sports, with a projected PE of 18 times for 2025, and other companies like Tabo, Weigao Medical, and Hailan Home, with varying PE ratios [4][9] - In textile manufacturing, recommended stocks include Shenzhou International and Huayi Group, with projected PE ratios of 11 and 15 times respectively for 2025 [4][9] - In the gold and jewelry sector, companies like Chow Tai Fook and Chaohongji are highlighted, with projected PE ratios of 16 and 18 times for 2025 [4][9]

Summary of Conference Call Industry or Company Involved - The discussion primarily revolves around the sportswear sector, particularly focusing on companies like Li Ning and manufacturers such as Shenzhou and Taobo. The context is set within the Hong Kong consumer market. Core Points and Arguments - The sportswear sector is showing signs of recovery, with a noticeable inflow of capital from both domestic and international investors, particularly from the U.S. consumer market after a volatile first quarter [1][2] - Taobo's early performance in this recovery phase is attributed to its offline retail business model, which suffered significant profit losses last year [2] - A neutral scenario suggests that if the consumption environment remains stable without substantial improvement, the profit for the next fiscal year could return to approximately 1.5 to 1.8 billion [3] - In a more optimistic scenario, the recovery of major brands like Adidas and Nike is expected to positively impact sales, with Nike likely to clear its inventory by the second half of the year [4][5] - The potential market capitalization could reach 30 billion under neutral assumptions, indicating a 20% upside from current levels [4] - If the profit margin improves, projections could rise to 40 billion, suggesting significant growth potential [6] - The decision to invest depends on the overall assessment of the consumption environment; if it is perceived as stabilizing, there may be room for growth [6] Other Important but Possibly Overlooked Content - Current inventory levels for Nike show significant improvement, with a notable reduction in discounts, indicating a positive trend in inventory management [8] - The call concluded with an invitation for further discussions on various companies, including Shenzhou and Taobo, and an announcement for a future session on the garment industry [9]

美国耶鲁大学预算实验室4月10日发布的最新研究估算显示，美国的关税政策将使美国家庭平均每年损 失4700美元。报告显示，关税对服装和纺织品的影响尤为显著，短期内消费者将面临服装价格上涨64% 的局面。长期来看，服装价格将上涨27%。 据统计，目前美国只有2.5%的服装和1%的鞋类为本土制造，越南等亚洲国家则是美国服装鞋帽的主要 进口来源地。越南纺织服装协会的数据显示，2024年越南纺织品服装出口额达440亿美元，美国是其最 大市场，耐克、露露乐蒙等服装品牌超过35%的产能聚集在越南。随着美国所谓"对等关税"措施即将实 施，这些服装品牌将被迫提价。 智通财经APP获悉，4月11日，工业和信息化部办公厅发布关于开展纺织服装特色产业集群建设工作的 通知。 对重点培育的纺织服装特色产业集群，工业和信息化部统筹推动集群建设工作，加强集群间产业对接， 推动集群数字化转型升级，强化产业集群创意设计能力，提升特色产品附加值，提高特色产业集群的竞 争优势。 银河证券发布行业周报称，国内制造业服企布局从产能规模增长逐步向高质量增长转变，发力高质量客 户和中高端产品，而高价值产品价格具有一定的调控空间。纺织服企的国际化产能布局优势 ...

Investment Rating - The industry investment rating is maintained as "Positive" [5] Core Insights - The report indicates that major US consumer companies are cautious about future fiscal year expectations, primarily due to tariff pressures and consumer downgrading trends in the US market. However, companies like Walmart and Lululemon express a more optimistic outlook for the Chinese market [3][23] - Recommendations include buying leading sportswear brand Anta Sports (02020), and considering Li Ning (02331), Xtep International (01368), and Tabo (06110) for buying or holding. Additionally, long-term prospects are favorable for resilient leading manufacturers such as Shenzhou International (02313), Weixing Co., Ltd. (002003), and Huali Group (300979) [3][23] Summary by Sections US Consumer Giants Performance - Walmart's FY26 revenue growth guidance is 3-4%, with a same-store sales increase of 23.1% in FY25Q4, driven by strong e-commerce and new store openings [10][13] - Target expects FY25 revenue growth of about 1%, with same-store sales remaining flat, facing pressure from tariffs and operational costs [14][15] - Dollar General anticipates FY25 revenue growth of 3.4-4.4%, with core consumers facing economic challenges and a notable trend of consumer downgrading [17][18] - Nike projects a mid-double-digit revenue decline for FY25Q4, with significant inventory issues and a 15% revenue drop in the Greater China region [19][20] - Lululemon expects FY25 revenue growth of 5-7%, with a strong growth forecast of 25-30% in the Greater China region [21][22] Investment Recommendations - The report suggests a cautious approach towards US consumer giants due to tariff pressures and consumer behavior changes, while highlighting positive growth prospects in China for certain brands [3][23]

Summary of the Conference Call for Tmall (滔搏) Company Overview - Tmall is the largest distributor of Adidas globally and the second-largest distributor of Nike. In the Chinese sports industry, Tmall holds a market share of approximately 16%, trailing only behind BaoSheng International at 11% [3][4]. Financial Performance - For the fiscal year 2024, Tmall's revenue is projected to be nearly 29 billion RMB, with a net profit exceeding 2.2 billion RMB [4]. - Tmall has maintained a high dividend payout, with a dividend rate exceeding 100% for three consecutive years and a current dividend yield of over 7% [4][7]. Operational Efficiency - Tmall has built a membership system with 81 million members, achieving a repurchase rate of 70%. This has significantly enhanced customer loyalty and operational efficiency [4][5]. - The company has improved inventory management through digital procurement and flexible inventory allocation, resulting in lower inventory turnover days compared to competitors [5]. Market Position and Strategy - Tmall's strong relationship with major brands like Adidas and Nike positions it well to benefit from brand recovery, especially after store adjustments [4][8]. - The company has shifted its strategy post-pandemic, focusing on larger stores and closing unprofitable smaller ones, resulting in a reduction of store count from nearly 8,400 to about 5,800, while improving sales per square meter [10]. Future Outlook - Despite pressures on profit margins in the first three quarters of fiscal year 2025, a revenue growth of 5-10% is expected to lead to a rebound in profit margins [9]. - Tmall's net profit growth is projected to exceed 20% annually from fiscal years 2025 to 2027, with a potential market capitalization of 27 billion RMB, indicating a 30% growth opportunity [4][17]. Brand Dynamics - Recent adjustments by Adidas and Nike, including local product launches and inventory management, are expected to provide Tmall with significant recovery opportunities [8][13]. - The management anticipates that as brand recovery becomes evident, Tmall's performance will directly benefit from these changes [7][12]. Investment Considerations - Tmall is viewed as a high-dividend stock with strong potential for capital appreciation, especially as market conditions shift towards consumer sectors [9][15]. - The current valuation is at a three-year low of 11-12 times earnings, with expectations of reaching 15 times by 2025, reflecting a positive outlook for investors [17].

Investment Rating - The report assigns a "Buy" rating to the company with a target price of HKD 4.33 based on a valuation of 15 times FY2025 earnings [4]. Core Views - The company has established itself as the largest retail partner for Adidas globally and the second largest for Nike, benefiting from strong operational capabilities and a focus on member services [1][2]. - The recovery of Nike and Adidas is expected to positively impact the company's performance, with a significant portion of its revenue derived from these brands [2][3]. - The company has maintained a high dividend yield, averaging 104% over the past three years, making it an attractive option for dividend-seeking investors [3]. Summary by Sections Company Highlights - The company has rapidly developed since establishing partnerships with Nike and Adidas, focusing on building a robust membership system that has grown to 81 million members by FY25H1, a fourfold increase since FY2020 [1][22]. - The company has improved inventory management and store efficiency, reducing the number of stores from 8,302 at the end of FY2018 to 6,144 by the end of FY2024, while enhancing store productivity [1][28]. Investment Logic - The company's performance is closely tied to the recovery of Nike and Adidas, with Adidas showing positive growth since the appointment of a new CEO in January 2023, indicating a successful local market strategy [2][36]. - Nike's new CEO, appointed in October 2024, is expected to implement strategies similar to those of Adidas, potentially leading to a recovery in performance [3][43]. Profit Forecast, Valuation, and Rating - The company is projected to have earnings per share (EPS) of 0.22, 0.27, and 0.32 CNY for FY2025, FY2026, and FY2027, respectively, with corresponding price-to-earnings (PE) ratios of 14, 12, and 10 [4]. - The report suggests that the current operational challenges are reflected in the stock price, and the anticipated recovery of Nike and Adidas could lead to significant stock price appreciation [4].

Market Overview - In February, the A-share market saw the CSI 300 index rise by 1.9%, while the textile and apparel sector increased by 1.3%[13] - The Hong Kong market's Hang Seng Index rose by 3.2%, with the textile and apparel sector index up by 2.9%[13] - The US market experienced a decline, with the S&P 500 index down by 1.4% and the consumer discretionary sector down by 9.4%[13] Brand Performance - In January, outdoor and women's apparel sales on Tmall, JD, and Douyin platforms saw significant growth, with respective year-on-year increases of 56% and 45%[19] - Notable brands such as KOLONSPORT and Bi Yin Le Fen achieved year-on-year sales growth of 81% and 101% respectively[24] - Major brands like Nike and Adidas reported year-on-year sales growth of 21% and 34% respectively on these platforms[24] Manufacturing Insights - Vietnam's textile and footwear exports grew by 3.4% and 2.7% year-on-year in January, despite high base effects[2] - Key Taiwanese manufacturers like Yu Yuan and Zhi Qiang reported over 20% growth in January, with Yu Yuan achieving record revenue for the month[2] - Nanshan Zhishang's stock surged by 81.5% due to its involvement in robotic tendon materials, indicating strong future demand[16] Investment Recommendations - The report recommends focusing on undervalued Hong Kong stocks and brands with new growth potential, such as All Cotton Era and Hai Lan Home[3] - For textile manufacturing, companies like Shenzhou International and Huali Group are highlighted for their strong growth prospects and market share potential[3] Risk Factors - Potential risks include macroeconomic weakness, international political and economic uncertainties, and significant fluctuations in exchange rates and raw material prices[3]

Investment Rating - The report maintains a "Buy" rating for the company and upgrades it to an industry favorite, with a target price of HKD 3.34, indicating a potential upside of 18.4% from the current price of HKD 2.82 [2][5]. Core Insights - The company's revenue performance is gradually improving, with expectations that FY25 revenue will outperform the previously guided high single-digit decline. The successful promotional strategies are credited for this positive trend [2][3]. - The recovery of Nike's brand strength, particularly after signing Wang Jiaer as a global ambassador, is expected to enhance market sentiment towards the company and improve FY26 performance outlook [4][5]. - The current valuation is considered low at 10.3x FY26 P/E, coupled with a high dividend yield of around 10%, suggesting significant upside potential compared to downside risks [2][5]. Revenue Trends - For 4QFY25, the company anticipates a reduction in revenue decline to low single digits year-on-year, an improvement from the previous quarter [3]. - The retail discounting strategy has deepened in 4QFY25, aligning with the company's inventory reduction efforts and increasing online sales proportion [3]. Financial Projections - The report provides financial forecasts indicating a revenue of RMB 27,129 million for FY25, a decline of 6% year-on-year, with a projected net profit of RMB 1,382 million, reflecting a 38% decrease [5][12]. - The expected financial metrics for FY26 include a slight revenue decline to RMB 26,849 million and a net profit increase to RMB 1,595 million, indicating a recovery trend [5][12]. Market Positioning - The company is positioned as a leading player in the sports apparel retail sector, with a focus on enhancing brand image and expanding market reach, particularly in lower-tier cities [4][5]. - The overall market sentiment is expected to improve as Nike enhances its product promotion and marketing efforts in China post-inventory resolution [4].

Investment Rating - The investment rating for the company is "Buy" and is maintained [6]. Core Insights - The company reported FY2025 Q3 retail data, showing a slight decline in retail sales year-on-year, which was better than expected [2][4]. - The retail trend is improving, with inventory clearance continuing. Q3 retail sales showed a low single-digit decline year-on-year, with significant improvement compared to Q2's low double-digit decline [7]. - The number of stores is at a low point, but it is expected to stabilize next year. The number of stores continued to decline at the end of Q3, with ongoing closures of inefficient stores from brands like Nike and Adidas [7]. - Nike has simplified its product line and is focusing on professional sports, which is expected to enhance its market position [7]. - The company's performance and valuation are at a low point, with a current dividend yield of approximately 8%, indicating absolute return value [7]. Summary by Sections Retail Performance - Q3 retail sales showed a low single-digit decline year-on-year, which was better than expectations [2][4]. - Inventory clearance is ongoing, with discounts deepening year-on-year, but inventory adjustments are in line with company expectations [7]. Store Count and Market Strategy - The number of stores is expected to stabilize next year after a period of decline due to store closures and restructuring [7]. - Nike's new CEO has introduced a simplified product line and is focusing on strengthening distributor relationships, particularly in the Greater China market [7]. Financial Projections - The company forecasts net profits for FY2025 to FY2027 at 1.389 billion, 1.660 billion, and 1.880 billion respectively, with corresponding valuations of 12X, 10X, and 9X [9]. - The expected dividend yields for FY2025 and FY2026 are approximately 8% and 10% respectively, highlighting the company's high dividend elasticity [7].

Investment Rating - The report maintains a "Buy" rating for the company, with a potential dividend yield of 8.2% for FY2025, which is considered attractive [5] Core Views - The company's FY25Q3 performance showed a mid-single-digit decline in total sales for retail and wholesale businesses, with a 2.1% QoQ and 4.4% YoY reduction in direct-operated store gross sales area [3] - E-commerce promotions helped narrow the sales decline in FY25Q3 compared to FY25Q2, with online pre-tax sales estimated to grow by double digits YoY, contributing to a mid-single-digit decline in overall channel sales [3] - Retail channel performance slightly outperformed the wholesale channel, with both showing similar sales trends [3] - Inventory management remains a priority, with direct-operated discounts deepening YoY in FY25Q3, consistent with the trend in FY25H1 [4] - The company continues to optimize its store network, with a high single-digit YoY reduction in store count by the end of FY25Q3, while average store area increased [4] - New store formats, such as the FOS (Future of Style) and HALO concept stores, have been introduced to enhance the retail experience and capabilities [4] Financial Projections - FY25/26/27 net profit attributable to shareholders is projected at RMB 1.40 billion, RMB 1.53 billion, and RMB 1.67 billion, respectively, representing YoY changes of -36.7%, +9.3%, and +9.2% [5] - Revenue for FY2024 is estimated at RMB 28.93 billion, with a 6.9% YoY growth, while FY2025E revenue is projected at RMB 26.41 billion, reflecting an 8.7% YoY decline [6] - Gross margin for FY2024 is 41.8%, expected to slightly decrease to 40.0% in FY2025E, and then recover to 40.4% and 40.6% in FY2026E and FY2027E, respectively [6] - Net profit margin is projected to decline from 7.6% in FY2024 to 5.3% in FY2025E, before recovering to 5.7% and 6.0% in FY2026E and FY2027E [6] - ROE is expected to decrease from 22.5% in FY2024 to 14.2% in FY2025E, then gradually recover to 15.5% and 17.0% in FY2026E and FY2027E [6] Market Data - The company's closing price on December 17, 2024, was HKD 2.96, with a total share capital of 6,201 million shares and a net asset value of RMB 9.5 billion [2] - Total assets stood at RMB 14.9 billion, with net assets per share at RMB 1.53 [2]