Investment Rating - The report assigns a "Buy" rating to Xtep International (1368) [1]. Core Views - Xtep International plans to divest KP assets and distribute a special dividend of USD 151 million to shareholders, which is expected to enhance the company's performance in 2024 and provide future benefits from KP's potential listing [2]. - The projected net profit for Xtep International from 2024 to 2026 is estimated at RMB 1.16 billion, RMB 1.31 billion, and RMB 1.48 billion respectively, with corresponding price-to-earnings (PE) ratios of 11, 10, and 9 times [2]. Summary by Sections Company Overview - Xtep International is involved in the textile and apparel industry, focusing on sportswear [1]. Financial Performance - The company reported a revenue of RMB 14.346 billion in 2023, with a year-on-year growth of 11% [4]. - The net profit for 2023 is projected to be RMB 1.03 billion, reflecting a 12% increase from the previous year [4]. Business Strategy - The divestment of KP is expected to clarify the business structure, focusing on running as the main brand, which will enhance synergy [2]. - The main brand's cash flow will support the future development of subsidiaries such as Saucony and Merrell, providing them with more financial resources [2]. Market Performance - The main brand's sales in April met expectations despite adverse weather conditions in the south, while northern sales performed better than anticipated [3]. - The main brand is currently offering discounts at 75%, showing an improvement in inventory turnover [3]. Future Outlook - If the divestment and related transactions are completed as planned, the company anticipates a reduction in losses from KP, which will positively impact overall profitability [2]. - Shareholders are expected to receive a dividend of HKD 0.447 per share, translating to a dividend yield of approximately 8% based on the closing price [2].
特步国际事件点评：拟剥离KP资产，派发特别股息