Investment Rating - The report assigns an "Outperform" rating to Amer Sports with a target price of $46, indicating a 22% upside potential. Anta Sports is rated "Market-Perform" with a target price of HKD 89, suggesting an 8% upside. Li Ning is rated "Underperform" with a target price of HKD 17, indicating a 16% downside potential [6][7]. Core Insights - China's sportswear market is transitioning from high-growth expansion to mature growth, with total market growth moderating to approximately 6% CAGR through 2030E. The outdoor segment is expected to maintain a structural outperformance at around 12% CAGR [1][10]. - The market is shifting from "land-grab" growth to share reallocation and premiumization, with success increasingly reliant on brand differentiation, technical innovation, and channel efficiency [1][19]. - Technical specialists are gaining market share within the outdoor category, with brands like Arc'teryx projected to increase their share from approximately 7% in 2019 to around 20% by 2025E [3][23]. Market Dynamics - The outdoor segment is now the largest category, with growth moderating to +12% YoY from a previous CAGR of 29% (2021–2025E). Apparel is leading category performance at +18% YoY, while sneakers grew +14% YoY [2][13]. - The sportswear market is expected to normalize to mid-single-digit growth through 2030E, structurally outperforming broader retail by approximately 2 percentage points annually [11][21]. - The exercising population in China is projected to reach 630 million by 2035E, supporting long-term structural demand for sportswear [11][37]. Competitive Landscape - Market share is fragmenting away from generalists toward specialized brands, with Anta maintaining approximately 21% share and Li Ning around 9% by 2030E. The "Others" category is expected to decline significantly [15][51]. - Premium brands are forecasted to hold a stable share of around 54% through 2030E, while mass brands will remain at approximately 46% [12][48]. - Brand performance is highly polarized, with technical specialists like Arc'teryx and Salomon capturing significant growth, while many established brands stagnate or decline [4][16]. Brand Performance - Top performers in 2025 include Arc'teryx (+167%), Salomon (+150%), and Descente (+84%), while established brands like Li Ning and Nike are underperforming with growth rates below the market average [4][17]. - The report highlights that premium positioning alone is insufficient for success; continuous innovation and strong local relevance are critical [18][30]. Outlook and Implications - The sector is expected to shift from category expansion to share reallocation, with winners being those who can defend premium positioning and expand into adjacent categories [19][25]. - The outdoor segment is projected to continue outpacing overall sportswear growth, with a forecasted CAGR of approximately 13% from 2025 to 2030E [22][26].

Investment Rating - The report maintains a BUY rating for Anta Sports, with a target price trimmed to HK$ 119.08, based on a 24x FY25E P/E ratio [1][3]. Core Insights - The acquisition of Jack Wolfskin is viewed positively, with the acquisition price considered attractive and significant potential for expansion in the mid-priced outdoor industry and European markets [1][11]. - Despite a slight decline in retail sales growth in March-April 2025, the outlook for Q2 2025 remains cautiously optimistic due to various growth drivers [11][12]. - The company's retail sales growth in Q1 2025 was satisfactory, with improvements in inventory management and a better-than-expected profit margin [10][11]. Financial Summary - Revenue projections for FY25E are set at RMB 78,235 million, with a year-on-year growth of 10.5% [2][12]. - Net profit for FY25E is estimated at RMB 14,961.4 million, reflecting a decrease of 12.7% year-on-year [2][12]. - The earnings per share (EPS) for FY25E is projected at RMB 4.66, down from RMB 5.34 in FY24A [2][12]. Market Performance - The current market capitalization of Anta Sports is approximately HK$ 226.67 billion, with a current stock price of HK$ 83.85, indicating a potential upside of 42% to the target price [3][4]. - The stock is trading at a P/E ratio of 17x for FY25E, which is considered attractive compared to its 5-year average of 25x [1][12]. Acquisition Details - Anta Sports announced the acquisition of Jack Wolfskin for USD 290 million (approximately RMB 23.5 billion), with expected sales of EUR 325 million and adjusted EBITDA of EUR 12 million for FY25E [11][18]. - The valuation metrics for the acquisition indicate a P/S ratio of approximately 0.8x, which is lower than both Anta's group average and the global sports industry average [11][18].