Ping An Securities·2024-03-26 16:00Investment Rating - The investment rating for Anta Sports (2020.HK) is "Strong Buy" with expectations of outperforming the market by over 20% within the next six months [10]. Core Views - The report highlights that Anta Sports has exceeded profit growth expectations and anticipates strong performance in the Olympic year [6][4]. - The company achieved a revenue of 62.36 billion yuan in 2023, representing a year-on-year increase of 16.2% [6]. - The report emphasizes the growth potential from three main segments: professional sports, fashion sports, and outdoor sports, alongside the benefits from the sports and outdoor industry boom [6]. Summary by Sections Financial Performance - Anta Sports reported a total revenue of 62.36 billion yuan in 2023, up 16.2% year-on-year [6]. - Gross profit reached 39.03 billion yuan, with a gross margin of 62.6%, reflecting a 20.8% increase from the previous year [6]. - The net profit attributable to shareholders was 10.24 billion yuan, a 34.9% increase, with a net profit margin of 16.4% [6]. - The company plans to increase its dividend payout to 1.97 HKD per share, with a payout ratio of 50.7% [6]. Revenue Breakdown - Revenue from the Anta brand was 30.31 billion yuan, a 9.3% increase, driven by reduced retail discounts and a higher direct-to-consumer (DTC) ratio [6]. - FILA brand revenue was 25.10 billion yuan, up 16.6%, attributed to improved store efficiency [6]. - Other brands generated 6.95 billion yuan, a significant increase of 57.7%, mainly from Descente and Kolon [6]. Future Projections - The report projects net profits for 2024 and 2025 to be 12.08 billion yuan and 14.18 billion yuan, respectively, with an expected net profit of 16.56 billion yuan in 2026 [6][7]. - The current stock price corresponds to a 2024 price-to-earnings (P/E) ratio of 17.8, indicating a favorable valuation [6].