Investment Rating - The report maintains a "Buy" rating for the company [6]. Core Views - The company is expected to see a recovery in cotton sock sales as it gradually expands its high-quality customer base and depletes existing inventory. The seamless management is also anticipated to improve profitability, with expectations for customer expansion and volume growth to drive an elastic growth curve. Excluding asset disposal gains, the projected net profit attributable to shareholders for 2025-2027 is estimated at 310 million, 360 million, and 400 million yuan, representing year-on-year changes of -4%, +14%, and +12% respectively. The corresponding price-to-earnings ratios are 13, 12, and 11 times, with a dividend yield of 4.5% based on a 60% payout ratio [2][4][11]. Financial Performance Summary - In Q3 2025, the company achieved revenue, net profit attributable to shareholders, and net profit excluding non-recurring gains of 715 million, 167 million, and 102 million yuan, with year-on-year changes of -5.2%, +71.2%, and +7.3% respectively. The increase in non-recurring gains was primarily due to significant gains from the disposal of non-current assets [4][11]. - The report highlights that the gross margin improved by 3.3 percentage points year-on-year and 2.4 percentage points quarter-on-quarter to 31.8% in Q3 2025, driven by improved gross margins in both cotton socks and seamless products. The net profit margin excluding non-recurring gains increased by 1.7 percentage points year-on-year, although the increase was less than that of the gross margin due to a rise in management and sales expense ratios [11][18].

Investment Rating - The report initiates coverage with a "Buy" rating for the company [12]. Core Insights - The company achieved a revenue of 515 million yuan in H1 2025, representing a year-on-year growth of 43.76%, and a net profit attributable to shareholders of 78.32 million yuan, up 432.14% year-on-year [1]. - The packaging segment generated 479 million yuan in revenue, a 52.85% increase year-on-year, driven by market expansion and significant growth in the packaging printing business [2]. - The cosmetics segment reported a revenue of 42.29 million yuan, down 13.52% year-on-year [2]. - The company has signed strategic cooperation agreements with several new clients, including major cosmetics and health companies, and has successfully developed new products in its subsidiaries [2]. Financial Summary - The company's gross margin improved to 28.40% in H1 2025, an increase of 7.37 percentage points year-on-year [3]. - Revenue projections for 2025-2027 are estimated at 1.117 billion yuan, 1.426 billion yuan, and 1.769 billion yuan, respectively, with net profits expected to be 152 million yuan, 204 million yuan, and 267 million yuan [3][4]. - The report indicates a significant increase in earnings per share, projected to rise from 0.31 yuan in 2024 to 0.88 yuan in 2027 [4]. Market Data - As of September 4, 2025, the company's closing price was 17.63 yuan, with a 12-month price range of 13.28 to 37.43 yuan [5]. - The total market capitalization is approximately 5.33 billion yuan [5]. Performance Metrics - The company has shown strong absolute returns of 80% over the past 12 months, outperforming the market [8]. - The projected price-to-earnings ratio is expected to decrease from 83.39 in 2024 to 19.97 in 2027, indicating improved valuation over time [4].

Investment Rating - The report maintains a "Buy" rating for the company [1] Core Views - The company achieved a revenue of 24.01 billion yuan in 2024, representing a year-on-year growth of 19.4%, and a net profit attributable to shareholders of 3.84 billion yuan, up 20.0% year-on-year. The proposed cash dividend is 2.3 yuan per share, with a dividend payout ratio of approximately 70%, exceeding expectations and marking the highest ratio since 2022 [5][11] - The company continues to expand production capacity actively, with new factories in Vietnam and Indonesia contributing to its growth. The production capacity in 2024 reached 230 million pairs of shoes, with a utilization rate of 96.7%, an increase of 10.1 percentage points year-on-year [11][12] Summary by Sections Financial Performance - In 2024, the company's gross profit margin improved by 1.2 percentage points to 26.8%. The gross profit margins for different product categories were 27.2% for sports casual shoes, 21.6% for outdoor boots, and 24.4% for sports sandals/slippers [9] - The company reported a significant increase in operating cash flow, amounting to 4.62 billion yuan, a 25.0% increase year-on-year [10] Sales and Market Position - The company sold 223 million pairs of sports shoes in 2024, with a year-on-year increase in sales volume of 17.5% and a slight increase in average selling price by 1.7% [7] - The top five customers accounted for 79.1% of total revenue, with a year-on-year revenue growth of 14.7%. Notably, new customers like On Running showed significant growth [8] Production and Capacity Expansion - The company has initiated production in three new factories in Vietnam and one in Indonesia, with plans for further expansion in China and Indonesia [11] - The company has invested in automation, with over 500 intelligent cutting machines deployed and four automated molding lines introduced in 2024 [11] Future Outlook - The company is expected to continue leveraging its leading position in the market, with forecasts for net profit attributable to shareholders of 4.36 billion yuan, 5.00 billion yuan, and 5.70 billion yuan for 2025, 2026, and 2027 respectively [12]