2024-04-01 16:00Investment Rating - The report maintains a "Buy" rating for Anta Sports with a target price of HKD 120, based on a projected PE of 26 times for 2024 [1][2][4]. Core Insights - Anta Sports achieved a revenue of RMB 62.36 billion in 2023, representing a year-on-year growth of 16.2%. The net profit attributable to shareholders increased by 34.9% to RMB 10.236 billion, exceeding expectations [1][2]. - The Direct-to-Consumer (DTC) transformation has significantly contributed to revenue growth, with DTC revenue for the main brand rising by 24.2% to RMB 17.005 billion in 2023 [2]. - The successful listing of Amer in February 2024 is expected to bring a one-time non-cash gain of RMB 1.6 billion, positively impacting the financial results for the first half of 2024 [1][2]. Financial Performance Summary - Revenue for 2023 was RMB 62.36 billion, with a gross margin of 62.6%, an increase of 2.4 percentage points year-on-year. The main brand's gross margin improved to 54.9% [1][3]. - The report forecasts EPS for 2024-2026 to be RMB 4.26, RMB 4.88, and RMB 5.46 respectively, with a projected revenue growth rate of 11.5% in 2024 [3][7]. - The company’s net profit margin is expected to rise from 16.4% in 2023 to 17.0% in 2024, indicating improved profitability [3][8]. Market Position and Strategy - Anta Sports is positioned as a leading player in the Chinese sportswear industry, benefiting from a multi-brand strategy that includes brands like Fila and Descente [2][4]. - The company has optimized its sales network, with over 12,000 stores globally, and plans to leverage the upcoming Paris Olympics to enhance brand visibility and competitiveness [2][4].