Core Viewpoint - Tambor Group Co., Ltd. is preparing for an IPO on the Hong Kong Stock Exchange, aiming to leverage its position as the fourth largest domestic outdoor apparel brand in China, with annual sales exceeding 1 billion RMB [2][4]. Company Background - Tambor was founded in 2004 by a couple from Sichuan, who initially started in the textile industry and later acquired a struggling down jacket factory, leading to the establishment of the brand [4][5]. - The company initially focused on seasonal leisure wear, positioning itself as a cost-effective alternative to high-end brands like Bosideng and Canada Goose [4][5]. Financial Performance - The company experienced a decline in revenue from approximately 660 million RMB in 2012 to 370 million RMB in 2016, attributed to insufficient marketing and brand recognition [5]. - From 2022 to 2024, Tambor's revenue grew from 732 million RMB to 1.3 billion RMB, with net profits of 86 million RMB, 139 million RMB, and 107 million RMB respectively [9][10]. Product Offering - Tambor defines itself as a professional outdoor apparel brand, offering three main product lines: top outdoor, sports outdoor, and urban light outdoor, with suggested retail prices ranging from 999 RMB to 3299 RMB [8][9]. - The urban light outdoor series accounted for 70% of revenue in the previous year, while the top outdoor and sports outdoor series are gradually increasing their revenue contributions [9]. Sales Channels - Online sales have seen significant growth, with a 79.6% increase in 2024, contributing approximately 52.7% of total revenue, while offline sales have stagnated, with a reduction in the number of physical stores [10][11]. - The company relies heavily on third-party manufacturers for over 90% of its products, which has led to increased costs and supply chain vulnerabilities [11]. Market Trends - The outdoor apparel market is shifting, with middle-class consumers increasingly seeking cost-effective options and smaller brands gaining popularity [12][15]. - The trend towards outdoor activities has seen fluctuations, with a recent decline in interest in high-cost outdoor gear, leading to a rise in more affordable outdoor activities [12][15].

Core Viewpoint - The Hong Kong sportswear sector has shown remarkable performance this year, with companies like 361 Degrees and Anta experiencing significant stock price increases. Recently, Tambor Group has submitted its prospectus for an IPO on the Hong Kong Stock Exchange, indicating a strategic move to capitalize on the favorable market conditions [1]. Company Overview - Tambor Group, established in 2004 in Shandong, China, specializes in professional outdoor sports apparel, offering three main product lines: top outdoor series, sports outdoor series, and urban light outdoor series, catering to various activities and environments [1][2]. - As of June 30, 2023, Tambor holds a market share of 1.54% in China's professional outdoor apparel market, ranking fourth among domestic brands and seventh overall when including international brands [2]. Financial Performance - Tambor's revenue has shown a consistent upward trend, with figures of RMB 732.4 million in 2022, RMB 1.021 billion in 2023, and projected RMB 1.302 billion for 2024. The profit for the same periods was approximately RMB 85.8 million, RMB 139.2 million, and RMB 107.3 million respectively [3][6]. - The company has significantly increased its online sales, with online self-operated stores becoming the main revenue driver, contributing 43.5% of total revenue in the first half of 2025, up from 20.3% in 2022 [7][8]. Marketing and Sales Strategy - Tambor has heavily invested in marketing, with sales and marketing expenses exceeding RMB 260 million in the first half of 2025, accounting for nearly 40% of revenue. This aggressive spending has impacted profit margins, reducing net profit margin from 13.6% in 2023 to 5.5% in the first half of 2025 [9][11]. - The company has also increased its inventory levels significantly, with stock reaching RMB 1.103 billion by the end of August 2025, resulting in a high inventory turnover period of 485.4 days [9][11]. Dividend Policy and Financial Health - Tambor has engaged in substantial dividend payouts, distributing RMB 35 million in 2022 and RMB 290 million in 2025, which raises concerns about financial sustainability given the high inventory and increased bank borrowings [11][12]. - As of June 30, 2025, the company had short-term and long-term bank borrowings totaling RMB 2.18 billion and RMB 890 million respectively, while cash and cash equivalents were only RMB 26 million [12][13]. Governance Concerns - The concentrated ownership structure, with the controlling shareholder holding approximately 96.64% of voting rights, raises potential governance issues, particularly regarding the sustainability of the company's financial practices and its future growth prospects [13].