Investment Rating - The investment rating for the company is "Accumulate" [6][10]. Core Views - The company reported a revenue of 9.844 billion yuan for Q3 2025, representing a year-on-year growth of 4.74%. However, the net profit attributable to the parent company was 537 million yuan, a decline of 28.90% year-on-year, with basic earnings per share at 0.20 yuan [3][6]. - The company has seen a slight decrease in inventory, and profit growth was achieved in Q3. The gross profit margin and net profit margin for the first three quarters were 45.12% and 5.38%, respectively, with year-on-year changes of +0.35 and -2.63 percentage points [6][3]. - The company is focusing on enhancing its online marketing and opening new offline stores, which has led to an increase in sales expense ratio, impacting net profit margins [6][3]. Financial Summary - For the first three quarters of 2025, the company had a total inventory of 4.142 billion yuan, a decrease of 0.64% year-on-year, with inventory turnover days increasing by 10.67 days to 190.50 days [6][3]. - In Q3 2025, the company achieved a revenue of 3.695 billion yuan, a year-on-year increase of 7.31%, and a net profit of 212 million yuan, up 4.55% year-on-year [6][3]. - The company plans to continue expanding its store count, with a total of 8,236 stores as of the first half of the year, an increase of 96 stores compared to the same period last year [6][8]. Earnings Forecast - The company has adjusted its EPS forecast for 2025 to 0.36 yuan, maintaining the EPS forecasts for 2026 and 2027 at 0.42 and 0.45 yuan, respectively. The corresponding PE valuation for 2025 is set at 15.00 times, which is below the average of comparable companies [10][6].

Core Viewpoint - The report from Guosen Securities expresses optimism about the operational resilience and long-term cash returns of Tabo (06110), highlighting a narrowing decline in retail sales and stable gross margins despite a challenging retail environment [1] Group 1: Financial Performance - In the first half of the 2026 fiscal year, Tabo's revenue decreased by 5.8% year-on-year to 12.3 billion, with retail channel revenue at 10.6 billion (down 3.0%) and wholesale channel revenue at 1.62 billion (down 20.3%) [1] - The main brands, Nike and Adidas, generated 10.81 billion in revenue, down 4.8%, while other brands saw a 12.2% decline to 1.41 billion [1] - Net profit attributable to shareholders fell by 9.8% to 790 million, with a slight decrease in gross margin to 41.0% and a net profit margin of 6.4% [1] Group 2: Cash Flow and Dividends - Operating cash flow decreased by 48.2% year-on-year to 1.35 billion, with a net cash ratio of 1.7 [1] - The interim dividend payout ratio was 102.2%, with a dividend of 0.13 per share [1] Group 3: Store and Membership Strategy - As of August 2025, the number of direct-operated stores decreased by 1,125 to 4,688 (down 19.4%), while total sales area declined by 14.1% [2] - The cumulative user base reached 89.1 million, with membership contributing 92.9% of sales, and high-value members accounting for nearly 35% of sales [2] Group 4: Market Position and Growth Strategy - The company is strategically enhancing its presence in the running and outdoor segments, partnering with high-end brands and opening specialized stores [2] - Online retail business experienced double-digit growth, with significant contributions from content e-commerce and private domain operations [2]

Core Insights - The Chinese sports footwear and apparel industry is undergoing a significant "value reconstruction," shifting consumer decision-making from "cost-performance" to "emotional value" [1] - Retailers are facing structural differentiation, requiring them to find ways to achieve quality growth amid uncertainty [1] Group 1: Company Performance - Tmall, the largest domestic sports retail operator, reported revenue of 12.3 billion yuan and a net profit of 790 million yuan for the period ending August 31, 2025 [1] - The company has over 20 cooperative brands and a user base exceeding 89 million, indicating a strong market presence [1] Group 2: Retail Strategy - The retail strategy has shifted from "scale expansion" to "value deepening," redefining the role of stores as "super interfaces" that drive omnichannel traffic [2] - Tmall employs a "preferred + optimized" strategy for store adjustments, aiming to enhance the multi-dimensional value of stores [2] Group 3: Digital and Omnichannel Integration - Tmall operates over 800 Douyin and WeChat video accounts, with more than 3,600 mini-program stores and over 3,700 instant retail stores, achieving double-digit growth in online sales [3] - The company has established a "1 (offline store) + N (online multi-scenario)" operational model to enhance online and offline channel synergy [2] Group 4: Brand Collaboration - Tmall is expanding its brand collaboration ecosystem by exclusively operating niche brands like norda™, soar, Ciele, and Norrøna, adapting to market segmentation and consumer upgrades [4][5] - The company aims to build long-term, trust-based strategic partnerships with core brand partners to respond to market changes effectively [4] Group 5: User Value and Membership - Approximately 92.9% of Tmall's sales come from members, with high-value members contributing 35% of membership sales despite being a small percentage of the total [7] - The company focuses on deepening user value through a refined operational system that includes demand matching, scenario penetration, and experience value [7] Group 6: Digital Empowerment - Tmall's digital transformation focuses on creating a "smart retail ecosystem" through enhanced inventory sharing, member value extraction, and optimized marketing strategies [8] - The company is investing in AI technology for supply chain efficiency, marketing conversion, and operational decision-making [8]

Core Insights - The company reported a revenue of 12.3 billion and a net profit of 790 million for the first half of the fiscal year, with cash and cash equivalents reaching 2.54 billion [1] Group 1: Business Model and Strategy - The company implements a "1+N" model in the omnichannel retail sector, centering around offline stores while integrating content e-commerce and private domain operations [1] - Online business achieved double-digit growth year-on-year, with over 800 Douyin and WeChat video accounts and more than 3,600 mini-program stores, accumulating over 89 million users [1] Group 2: Digital Transformation and Brand Expansion - The company is advancing its digital transformation, optimizing product management and circulation efficiency around integrated omnichannel strategies [1] - New brand partnerships include exclusive operations for Norwegian outdoor brand Norrøna and running brands soar and Ciele in China, alongside the introduction of the running multi-brand store brand ektos [1] Group 3: Customer Engagement and Sales Performance - Membership sales accounted for 92.9% of total retail sales from offline and mini-programs, with repeat members contributing 60% of membership consumption, highlighting high user stickiness [1] - The company plans to continue focusing on omnichannel retail, user operations, and business innovation while deepening digital empowerment [1]

Core Viewpoint - The company reported a revenue of 12.3 billion yuan for FY25/26 H1, a year-on-year decrease of 5.8%, and a net profit of 790 million yuan, down 9.7% year-on-year, while proposing an interim dividend of 0.13 yuan per share, with a payout ratio increasing by 2.8 percentage points to 102.2% [1] Revenue and Profit Analysis - The main brands (Nike + Adidas) and other brands (PUMA + Converse + VF, etc.) saw revenue declines of 4.8% and 12.2%, respectively, with total revenues of 10.81 billion yuan and 1.41 billion yuan, accounting for 87.9% and 11.5% of total revenue [1] - Retail and wholesale businesses experienced declines of 3.0% and 20.3%, with revenues of 10.60 billion yuan and 1.62 billion yuan, while online retail achieved double-digit growth [2] Operational Efficiency and Cash Flow - The company's gross margin decreased by 0.1 percentage points to 41.0%, primarily due to increased discounts from a higher proportion of online sales, although retail sales and brand support partially offset this impact [2] - The end-of-period inventory decreased by 4.7% to 5.83 billion yuan, with inventory turnover days increasing by 1.7 days to 150 days [2] - Net cash flow from operating activities fell by 48.2% to 1.36 billion yuan, influenced by changes in accounts receivable and payable [2] Strategic Initiatives - The company is enhancing its competitive edge through a comprehensive retail strategy and expanding its presence in running and outdoor segments, adding new partner brands and opening a multifunctional running community store in Shanghai [3] - The company aims to improve profitability and maintain a high dividend payout ratio, with expectations for profit stability in FY26 and improved margins in the long term [3] Earnings Forecast and Valuation - The company has adjusted its net profit forecasts for FY2026-27 down by 20% and 23% to 1.30 billion yuan and 1.49 billion yuan, respectively, while introducing a forecast of 1.70 billion yuan for FY28 [3] - The target price is set at 4.0 HKD, reflecting a PE ratio of 15.2x for FY27, maintaining a "buy" rating due to the company's leading position in comprehensive retail and attractive dividend yield [3]

Core Viewpoint - The company reported its FY26 interim results, which met expectations, and continued its high dividend policy, emphasizing shareholder returns Financial Performance - Revenue for the first half of FY26 decreased by 6% year-on-year to 12.3 billion yuan, while net profit attributable to shareholders fell by 10% to 790 million yuan, aligning with expectations [1] - The company proposed an interim dividend of 0.13 yuan per share, resulting in a high payout ratio of 102% [1] Brand Performance - Revenue from the main brand declined by 5% to 10.81 billion yuan, with the decline rate improving from 6% in FY25, accounting for 88% of total revenue [1] - Other brands saw a 12% drop in revenue to 1.41 billion yuan, representing 12% of total revenue, while joint venture revenue fell by 15% to 60 million yuan [1] Channel and Operational Efficiency - Direct sales revenue decreased by 3% to 10.6 billion yuan, making up 86% of total revenue, with a reduction of 332 stores to 4,688 [2] - The company is leveraging multi-channel strategies, including Douyin, mini-programs, and instant retail, resulting in double-digit growth in online retail [2] - Wholesale revenue dropped by 20% to 1.6 billion yuan, indicating ongoing adjustments [2] Cost Management - Gross margin remained stable, slightly decreasing by 0.1 percentage points to 41.0%, benefiting from brand partnerships and an increased share of retail business [2] - Sales and management expenses decreased by 5.5% year-on-year, with the expense ratio slightly increasing by 0.1 percentage points [3] - The net profit margin decreased by 0.3 percentage points to 6.4% [3] Inventory and Cash Flow - Inventory decreased to 5.8 billion yuan from 6 billion yuan at the beginning of the period, with inventory turnover days at 150 [4] - Operating cash flow was 1.35 billion yuan, down 48% year-on-year, primarily due to timing differences in accounts receivable related to seasonal sales [4] Strategic Focus - The company is committed to high-quality growth in the sports apparel retail sector, focusing on comprehensive retail strategies and brand expansion [4] - Collaboration with major brands like NIKE and Adidas continues to enhance retail capabilities and channel optimization [4] - Profit forecasts for FY26-28 are set at 1.29 billion, 1.42 billion, and 1.55 billion yuan, with corresponding P/E ratios of 15, 14, and 13 times, maintaining a "buy" rating [4]

Core Viewpoint - The company's 1HFY26 performance met expectations, with a revenue decline of 6% year-on-year to 12.3 billion yuan and a net profit drop of 10% to 800 million yuan, while maintaining a high dividend payout ratio of approximately 102% [1][2]. Performance Review - Revenue was impacted by fluctuations in terminal retail, leading to a focus on optimizing offline channels and expanding online retail operations [1]. - The main brands, Nike and Adidas, saw a revenue decline of 5%, accounting for 88% of total revenue, while other brands experienced a 12% decline [1]. - Direct sales and wholesale revenues fell by 3% and 20% respectively, with a total of 4,688 direct stores, a decrease of 332 stores from the beginning of the fiscal year [1]. - The company opened a new running concept store, ektos, in Shanghai, showcasing innovation in offline retail formats [1]. - Online retail sales grew by double digits, supported by a diversified operational model [1]. Profitability and Cost Control - Gross margin remained stable, with a slight decrease of 0.1 percentage points to 41%, influenced by increased promotional activities in online sales and a higher retail proportion [2]. - The overall expense ratio only increased by 0.1 percentage points to 33.2%, demonstrating effective cost management despite revenue decline [2]. - The net profit margin decreased by 0.3 percentage points to 6.4%, with a net profit decline of 9.8% [2]. - Inventory management was effective, with a 4.7% decrease in inventory by the end of August [2]. - The operating cash flow was healthy, with a net cash flow of 1.35 billion yuan, supporting a high dividend payout ratio [2]. Development Trends - Management indicated that terminal retail performance in September and October would align with 2QFY26, focusing on profit maintenance and improvement in net profit margin for FY26 [2]. Earnings Forecast and Valuation - The company maintains its EPS forecasts for FY26 and FY27 at 0.21 yuan and 0.26 yuan respectively, with current stock prices reflecting 15 and 12 times the FY26 and FY27 earnings [2]. - The target price has been raised by 23% to 4.17 HKD, corresponding to 18 and 15 times the FY26 and FY27 earnings, indicating a potential upside of 20% [2].

Investment Rating - The investment rating for the company is "Buy" (maintained) [4] Core Views - The company is initiating a comprehensive retail strategy with new brand expansions across various categories, enhancing its brand matrix [4] - Despite challenges in the retail environment, the company's strategy is expected to sustain traffic and sales through diversified channels [6] - Collaborations with leading international brands like Nike and Adidas are anticipated to drive future growth [6] Financial Performance Summary - For FY25/26, the company reported a revenue of 12.299 billion RMB, a year-on-year decrease of 5.79%, with a gross profit of 5.037 billion RMB, down 6.06% [6] - The net profit attributable to shareholders for FY25/26 was 789 million RMB, reflecting a decline of 9.69% [6] - The company maintains a high dividend payout ratio, achieving 102.2% in FY25/26, and a cumulative payout ratio of 107.3% since FY2019/20 [6] Earnings Forecast and Valuation - Revenue projections for the company are as follows: 28,933.20 million RMB in 2024, 27,012.90 million RMB in 2025, and 26,443.89 million RMB in 2026, with a forecasted growth rate of -6.64% for 2025 [5] - Net profit forecasts are 2,213 million RMB for 2024, 1,286 million RMB for 2025, and 1,417.56 million RMB for 2026, with a significant decline of 41.89% expected in 2025 [5] - The company is projected to achieve earnings per share of 0.36 RMB in 2024, decreasing to 0.21 RMB in 2025, and recovering to 0.23 RMB in 2026 [5]

Investment Rating - The report maintains a "Buy" rating for the company, indicating a strong performance relative to the market [7][6][17] Core Insights - The company reported a 6% year-on-year decline in revenue to 12.3 billion RMB for the first half of FY26, with a net profit decrease of 10% to 0.79 billion RMB, aligning with expectations [7][9] - The company proposed a mid-term dividend of 0.13 RMB per share, achieving a high payout ratio of 102%, emphasizing shareholder returns [7] - The main brand's revenue decline narrowed to 5%, while other brands faced a 12% drop, attributed to fluctuations in consumer environment and reduced foot traffic [7] - The company is enhancing operational efficiency through channel optimization and a multi-channel approach, resulting in double-digit growth in online retail [7][6] Financial Data and Earnings Forecast - Revenue projections for FY2024 to FY2028 are as follows: 28.93 billion RMB (FY2024), 27.01 billion RMB (FY2025), 25.94 billion RMB (FY2026E), 27.34 billion RMB (FY2027E), and 29.04 billion RMB (FY2028E) [6][17] - Net profit forecasts are 2.21 billion RMB (FY2024), 1.29 billion RMB (FY2025), 1.29 billion RMB (FY2026E), 1.42 billion RMB (FY2027E), and 1.55 billion RMB (FY2028E) [6][17] - The gross margin is projected to be 41.8% (FY2024), declining to 38.4% (FY2025) and stabilizing around 39.3% to 40% in subsequent years [6][17] Operational Performance - The company has reduced its direct store count by 332 to 4,688 stores, with a 3% decline in direct sales to 10.6 billion RMB, indicating a strategic focus on operational efficiency [7] - Inventory levels decreased to 5.8 billion RMB, with inventory turnover days at 150 days, reflecting improved inventory management [7] - The company maintains a strong online presence with over 800 Douyin and WeChat video accounts, and more than 3,600 mini-program stores, establishing a comprehensive online-offline operational network [7]

Investment Rating - The report maintains a "Buy" rating for the company [2] Core Insights - The company reported a 6% year-on-year decline in revenue to 12.3 billion RMB for the first half of FY26, with a net profit decrease of 10% to 0.79 billion RMB, aligning with expectations. A high dividend payout ratio of 102% was proposed, emphasizing shareholder returns [7] - The main brand's revenue decline has narrowed to 5%, while other brands faced a 12% drop, attributed to fluctuations in consumer environment and reduced foot traffic [7] - The company is enhancing operational efficiency through channel optimization and multi-channel integration, with a notable increase in online retail sales [7] - Gross margin remained stable with a slight decrease of 0.1 percentage points to 41.0%, supported by brand partnerships and improved retail business proportions [7] - The company is focused on high-quality growth in the sports apparel retail sector, maintaining strong partnerships with Nike and Adidas, and expanding its brand portfolio [7] Financial Data and Profit Forecast - Revenue projections for FY2024 to FY2028 are as follows: 28.93 billion RMB, 27.01 billion RMB, 25.94 billion RMB, 27.33 billion RMB, and 29.04 billion RMB respectively, with a forecasted net profit of 2.21 billion RMB for FY2024 [6][17] - The company expects net profits for FY26 to be 1.29 billion RMB, with corresponding PE ratios of 15, 14, and 13 for FY26, FY27, and FY28 respectively [7]