Investment Rating - The report gives a "Buy" rating for the company with a target price of 5.77 HKD, based on a 9x PE multiple for 2025 [2][5] Core Views - The company is a global apparel manufacturing giant with nearly 50 years of industry experience, focusing on five core categories: casualwear, sportswear & outdoor wear, denim, intimate wear, and sweaters [1] - The global apparel manufacturing industry is expected to see increased market share for leading companies due to factors like rising quality demands, cost pressures, and trade frictions [1] - The company has a wide moat, including strong customer relationships, a global manufacturing platform, and excellent R&D capabilities supporting a co-creation business model [2] - Future growth is expected to be driven by vertical integration, automation, and reduced exposure to US-China trade risks [2] Financial Performance - Revenue is forecasted to grow from 2,476 million USD in 2024E to 3,167 million USD in 2026E, with a CAGR of 13.1% [3] - Net profit is expected to increase from 204 million USD in 2024E to 269 million USD in 2026E, with a CAGR of 14.8% [3] - EPS is projected to grow from 0.07 USD in 2024E to 0.09 USD in 2026E [3] Industry Analysis - The global apparel market has shown steady growth, with the sportswear segment growing at a higher rate (4.3% CAGR from 2010-2023) [66] - The apparel manufacturing industry is highly fragmented, with leading companies expected to gain market share due to vertical integration and cost advantages [66][68] - Companies with vertical integration capabilities tend to have better profitability due to cost control, faster response times, and stronger R&D capabilities [71] Competitive Advantages - The company has deep relationships with global apparel brands, with some partnerships spanning 10-30 years [91] - It has a global manufacturing footprint across Vietnam, China, Cambodia, Bangladesh, and Sri Lanka, with 82% of employees located overseas [103] - The company's co-creation model with customers enhances product innovation and strengthens customer relationships [90] - Cross-category sales have been effective in expanding business opportunities [90] Future Outlook - The company is advancing vertical integration and automation, with plans to establish a modern center in Vietnam for advanced equipment development by 2024 [2] - The proportion of US revenue has been declining, which is expected to further reduce trade friction risks [2] - The company's focus on sportswear and outdoor wear is expected to drive future growth, with this category's revenue share increasing from 10% in 2017 to 22% in 2023 [38]
晶苑国际：全球制衣巨头，护城河宽，未来有望保持稳健增长