Investment Rating - The report assigns a "Strong Buy" rating, indicating an absolute upside of over 50% over the next 12 months [13]. Core Insights - Nameson (01982.HK) experienced a year-on-year decline of 4.9% in topline revenue for FY 2023/24, totaling HKD 4,378.9 million. Despite this, there was a 1.5 percentage point increase in gross margin [2][10]. - The company is facing challenges due to a shrinking market size for knitwear products and strong capital requirements for expansion plans, which are expected to lead to a higher gearing ratio and lower dividend payout ratio [3][10]. - The fabric market remains weak, contributing to losses in this business segment, although the company plans to invest approximately HKD 400 million to expand its fabric production capacity [10][15]. Financial Performance Summary - Revenue for the past four fiscal years is as follows: - FY 2020/21: HKD 3,848.6 million - FY 2021/22: HKD 4,040.5 million - FY 2022/23: HKD 4,602.3 million - FY 2023/24: HKD 4,378.9 million [26]. - Gross profit figures for the same period are: - FY 2020/21: HKD 701.4 million - FY 2021/22: HKD 706.1 million - FY 2022/23: HKD 745.5 million - FY 2023/24: HKD 774.2 million [26]. - Net profit showed significant growth, with FY 2023/24 reaching HKD 380.7 million, a year-on-year increase of 140.5% [26]. Market and Operational Insights - The company anticipates stable sales volume in FY 2024/25 based on the current order book, although there are concerns regarding potential adjustments in order placements by major customers [15]. - The average selling price (ASP) of knitwear products has decreased from HKD 125.6 per unit to HKD 109.2 per unit, primarily due to a drop in cashmere product prices and decreasing raw material costs [15]. - Nameson plans to incur additional investments of HKD 150 million and HKD 100 million for expanding production capacity in Vietnam in FY 2024/25 and FY 2025/26, respectively [15].
南旋控股：Stable forecast with an aggressive expansion plan