Group 1 - The core view of Guosen Securities is optimistic about Xtep International's focus on the mass market for steady growth, with its brands Saucony and Merrell maintaining rapid growth by targeting "dual elite groups" and outdoor activities, respectively [1][2] - Guosen Securities maintains its profit forecast, expecting net profits for 2025-2027 to be 1.4 billion, 1.49 billion, and 1.6 billion yuan, representing year-on-year growth of 13.2%, 5.9%, and 7.7% [1] - The reasonable valuation range is maintained at 6.1-6.6 HKD, corresponding to a 2026 PE of 11-12x, with a rating of "outperform the market" [1] Group 2 - In Q4, Xtep's main brand retail sales remained flat year-on-year, with retail discounts between 70-75%, while Saucony's retail sales grew over 30% [1][2] - The main brand's retail sales for the full year showed low single-digit growth, with an inventory turnover ratio of approximately 4.5 months at year-end [1] - The running category performed well, with core series like "Two Thousand Kilometers" and "Champion Family" showing strong results despite negative factors such as temperature and delayed Spring Festival [2]

Core Insights - The core viewpoint of the article indicates that Xtep International's retail sales performance shows mixed results, with the main brand's sales growth stagnating while the Saucony brand experiences significant growth [1] Group 1: Retail Sales Performance - Xtep's main brand retail sales growth remained flat year-on-year, with retail discount levels maintained between 70% to 75% [1] - The Saucony brand achieved over 30% year-on-year growth in retail sales [1] Group 2: Operational Overview - For the fiscal year 2025, Xtep's main brand is projected to have low single-digit year-on-year growth in retail sales [1] - Inventory turnover for channels is approximately four and a half months [1] - Saucony brand continues to maintain over 30% year-on-year growth [1]

Group 1 - The core viewpoint of the report maintains the EPS forecast for Xtep International at 0.49/0.55 CNY for 2025/26 and introduces a new EPS forecast of 0.61 CNY for 2027, with a target price adjustment down by 11% to 6.47 HKD, indicating a 27% upside potential from the current stock price [1] Group 2 - The company reported that the retail revenue of its main brand remained flat year-on-year in Q4 2025, with retail discounts maintained at 70-75%, and channel inventory turnover at 4.5 months by the end of December [2][3] - The retail environment showed fluctuations, with the main brand's performance being stable despite some impact from weather in December; online channels, particularly live e-commerce, performed well [3] Group 3 - The Saucony brand experienced over 30% year-on-year growth in retail revenue for Q4 2025, with strong offline channel growth and an average store efficiency of 450,000 CNY per month [4] - The company plans to enhance the offline store efficiency of its main brand and aims to open 20-30 new premium stores in 2026, while also expanding its outlet store presence significantly [5]

Investment Rating - The report maintains a "Buy" rating for the company [3][5] Core Views - The main brand of the company is under short-term pressure, but the Saucony brand is expected to continue its rapid growth in the future [2][8] - The company has adjusted its earnings forecast for 2025-2027, estimating earnings per share of 0.49, 0.53, and 0.59 RMB respectively, with a target price of 7.06 HKD based on a 12x PE valuation for 2026 [3][9] Financial Performance Summary - Revenue (in million RMB) is projected to be 14,380 in 2025, 15,321 in 2026, and 16,451 in 2027, with year-on-year growth rates of 5.9%, 6.5%, and 7.4% respectively [4] - Operating profit (in million RMB) is expected to be 1,974 in 2025, 2,218 in 2026, and 2,463 in 2027, with growth rates of 0.5%, 12.3%, and 11.1% respectively [4] - Net profit attributable to the parent company (in million RMB) is forecasted to be 1,366 in 2025, 1,494 in 2026, and 1,661 in 2027, with growth rates of 10.3%, 9.4%, and 11.2% respectively [4] - The gross margin is expected to improve from 44.0% in 2025 to 45.0% in 2027 [4] - The net profit margin is projected to increase from 9.5% in 2025 to 10.1% in 2027 [4] - The return on equity is expected to be 13.5% in 2025 and improve to 14.2% in 2027 [4] Brand Performance Insights - The main brand's revenue is under pressure due to a weak consumer environment and increased competition, but it is expected to stabilize through channel expansion and product innovation [8] - The Saucony brand has shown strong growth, with a revenue increase of over 30% year-on-year in the fourth quarter, and is expected to continue outperforming the industry [8]

Investment Rating - The industry rating is "Recommended" [6] Core Insights - Anta's Q4 2025 operational data shows a decline in main brand sales, while FILA and other brands experienced low single-digit negative growth and mid-single-digit positive growth, respectively. For the entire year of 2025, Anta, FILA, and other brands recorded retail sales growth of low single digits, mid-single digits, and 45-50% positive growth [2][3] - Xtep's Q4 2025 operational data indicates that the main brand's retail sales remained flat, with discounts ranging from 70% to 75%. The Saucony brand achieved over 30% year-on-year growth in retail sales. For the full year of 2025, Xtep's main brand and Saucony recorded low single-digit and over 30% positive growth in retail sales, respectively [2][3] Summary by Sections 1. Weekly Insights - Anta's Q4 2025 operational data shows a decline in main brand sales, while FILA and other brands experienced low single-digit negative growth and mid-single-digit positive growth, respectively. For the entire year of 2025, Anta, FILA, and other brands recorded retail sales growth of low single digits, mid-single digits, and 45-50% positive growth [2][3] - Xtep's Q4 2025 operational data indicates that the main brand's retail sales remained flat, with discounts ranging from 70% to 75%. The Saucony brand achieved over 30% year-on-year growth in retail sales. For the full year of 2025, Xtep's main brand and Saucony recorded low single-digit and over 30% positive growth in retail sales, respectively [2][3] 2. Market Review - The Shanghai Composite Index rose by 0.84%, while the SW textile and apparel sector increased by 3.83%, outperforming the Shanghai Composite Index by 2.99% [14] - The top five stocks in the textile and apparel sector by weekly increase were Tianchuang Fashion, Yanjing Co., Mengjie Co., Tanshan Outdoor, and Sanfu Outdoor [14] 3. Industry Data Tracking 3.1. Raw Material Data - The Australian wool market index rose by 6.49% in the week ending January 15, 2026, and has increased by 38.49% since the beginning of 2025 [4][32] - The cotton price index in China decreased slightly, with a year-to-date increase of 1.83% as of January 23, 2026 [26] 3.2. Export Data - In 2025, textile and apparel exports totaled $267.79 billion, a year-on-year decrease of 2.26% [45] - In December 2025, the export value of oilcloth, tents, and sunshades decreased by 8.89% year-on-year [50] 3.3. End Consumer Data - In December 2025, the online retail sales of the apparel industry decreased by 11.93% year-on-year, with a total of 45.55 billion yuan [3.3.4] - The total retail sales of social consumer goods in 2025 grew by 0.9% year-on-year, while online retail sales increased by 8.6% [3.3.5]

Core Viewpoint - Xtep International reported stable retail sales growth for its main brand, while its Saucony brand experienced significant growth, indicating a mixed performance across its product lines [2] Group 1: Retail Performance - As of December 31, 2025, retail sales for Xtep's main brand showed a year-on-year growth of 0%, with retail discount levels maintained between 70% to 75% [2] - The Saucony brand achieved over 30% year-on-year growth in retail sales, highlighting its strong market performance [2] Group 2: Operational Insights - For the fiscal year 2025, Xtep's main brand is expected to see low single-digit year-on-year growth in retail sales, indicating a modest outlook [2] - Inventory turnover for channels is approximately four and a half months, suggesting a stable inventory management strategy [2] - The Saucony brand continues to maintain over 30% year-on-year growth, reinforcing its position in the market [2]

Core Viewpoint - CITIC Construction Investment maintains a "Buy" rating for Xtep International (01368), projecting revenue growth from 2025 to 2027 at 143.2 billion, 152.6 billion, and 163.7 billion CNY, with year-on-year increases of 5.5%, 6.6%, and 7.2% respectively, and net profit growth of 10.5%, 11.1%, and 10.0% over the same period [1] Group 1 - In Q3 2025, Xtep's main brand retail sales experienced low single-digit growth, with retail discount levels around 70-75% and inventory turnover of approximately 4-4.5 months [1][2] - The report indicates that online sales growth continues to outpace offline, with children's products growing faster than adult products [2] - The company is focusing on upgrading offline store images and expanding outlet layouts while continuing to push the full product line for running [2] Group 2 - The Saucony brand saw retail sales growth exceeding 20% in Q3 2025, with offline sales maintaining a strong growth momentum of over 30% [2] - As of the end of September, Saucony had over 170 stores, an increase of nearly 30 stores since the beginning of the year [2] - Looking ahead to Q4 2025, Xtep plans to reclaim distribution rights for approximately 400-500 Xtep stores in H2 2025 and 2026, with an expected short-term impact on revenue [2]

Core Viewpoint - CITIC Securities maintains a "Buy" rating for Xtep International (01368), projecting revenue growth from 2025 to 2027 at 143.2 billion, 152.6 billion, and 163.7 billion yuan, with year-on-year increases of 5.5%, 6.6%, and 7.2% respectively, and net profit growth of 10.5%, 11.1%, and 10.0% [1] Group 1 - In Q3 2025, Xtep's main brand retail sales experienced low single-digit growth, with retail discount levels around 70-75% and inventory turnover of approximately 4-4.5 months [2] - The report indicates that online sales growth continues to outpace offline, with children's products growing faster than adult products [2] - The company is focusing on enhancing its running product line and upgrading store images in offline channels while emphasizing outlet store expansion [2] Group 2 - The Saucony brand saw retail sales growth exceeding 20% in Q3 2025, with offline sales maintaining a strong growth rate of over 30% [2] - As of the end of September, Saucony had over 170 stores, an increase of nearly 30 stores since the beginning of the year [2] - Looking ahead to Q4 2025, Xtep plans to reclaim distribution rights for approximately 400-500 Xtep stores in H2 2025 and 2026, which is expected to have a short-term impact on revenue [2]

Investment Rating - The investment rating for the company is "Outperform the Market" (maintained) [1][3][7] Core Views - The company's main brand retail sales in Q3 showed low single-digit year-on-year growth, while the Saucony brand experienced over 20% growth [2][3] - The management maintains the annual guidance, indicating stable growth prospects for the main brand and strong performance for the professional sports brand [3][6] - The company focuses on the running category, leveraging its expertise to achieve steady sales growth, with Saucony and another brand, Maile, targeting specific consumer segments for faster growth [3][9] Summary by Sections Q3 Performance - The main brand's retail sales in Q3 grew low single digits year-on-year, with better performance in July and August compared to September [4] - Online sales outperformed offline sales, with children's products showing stronger growth than adult products, particularly in functional categories like running and outdoor [4] Retail Discounts and Inventory - Retail discounts for the main brand remained stable at 70-75%, with inventory turnover ratio stable at 4.0-4.5 months, indicating a healthy inventory level [5] Brand Growth - Saucony's sales grew over 20%, with strategic adjustments made to reduce low-priced products in e-commerce and tighten discounts [6] - The management expects Saucony's revenue growth to exceed 30% in 2025, with profits anticipated to grow over 10% [6] Financial Forecasts - The company forecasts net profits of 1.4 billion, 1.49 billion, and 1.6 billion yuan for 2025, 2026, and 2027, respectively, with year-on-year growth rates of 13.2%, 5.9%, and 7.7% [3][10] - The reasonable valuation range is maintained at 6.1-6.6 HKD, corresponding to a PE ratio of 11-12x for 2025 [3][9]

Core Viewpoint - Xtep International is optimizing its multi-brand matrix by divesting its fashion sports brand in 2024, focusing on its core running business, and enhancing resource allocation. The company plans to initiate a DTC transformation in 2025, which is expected to solidify its position in the professional sports sector and maintain a "Buy" rating [1] Group 1: Financial Performance - In Q3 2025, Xtep's main brand achieved a low single-digit year-on-year growth in total channel revenue, consistent with Q2's performance, with online sales showing double-digit growth and children's products outperforming adult categories [2] - The net profit forecasts for Xtep are projected at 1.37 billion, 1.49 billion, and 1.6 billion yuan for 2025, 2026, and 2027 respectively, corresponding to PE ratios of 11, 10, and 9 [1] Group 2: Brand and Product Development - Saucony brand experienced over 20% year-on-year growth in total channel revenue in Q3, with offline revenue increasing by over 30%. The brand opened 16 new stores, primarily in first and second-tier city core business districts, maintaining an annual store opening target of 30-50 [3] - Saucony is focusing on the running scene and expanding its apparel and OG series, receiving positive market feedback, and is confident in achieving over 30% growth for the year [3] Group 3: Inventory and Discount Management - Xtep's main brand maintained a healthy inventory turnover ratio of 4-4.5 months and discount levels between 70-75%, indicating effective supply chain management and terminal sales efficiency [4] - Saucony's inventory and discount levels are also within controllable ranges, allowing flexibility for promotions in Q4 [4] Group 4: Channel Innovation and Expansion - Xtep is continuously optimizing its channel structure, with over 70% of its stores upgraded to the new 9th generation and leading stores. The company is accelerating its presence in shopping centers and outlet stores [5] - The outlet channel, represented by leading and selected outlets, is expected to expand to 70-100 stores by 2026, aligning with positive market trends in outlet traffic and sales [5] Group 5: DTC Transformation - Xtep plans to reclaim approximately 100 stores in Q4, with a total of 400 stores by the end of 2025, involving a capital expenditure of around 400 million yuan. This move is expected to enhance the company's long-term channel competitiveness [6]