Industry Overview - The fishing tackle industry in China is experiencing growth due to rising living standards and health awareness, with fishing becoming a popular leisure activity among the youth and retirees [1][9] - The market size of the fishing tackle industry is projected to reach 31.4 billion yuan in 2024, representing a year-on-year growth of 3.0%, with fishing rods accounting for approximately 28%, fishing reels for 18%, baits for 15%, and fishing lines and hooks for 13% [1][9] Industry Chain - The upstream of the fishing tackle industry includes suppliers of raw materials such as carbon fiber, fiberglass, stainless steel, high carbon steel, plastics, rubber, and synthetic fibers, as well as component suppliers like guides, gears, and axles [5] - The midstream involves research, design, and production of fishing tackle, while the downstream consists of sales channels including specialized fishing stores, outdoor goods stores, and e-commerce platforms, targeting both recreational and competitive anglers [5] Consumer Demographics - The primary consumer demographic for fishing tackle in China is the 25-44 age group, which constitutes 46% of the market, driven by their economic capability and leisure needs [7] - Consumers aged 45 and above account for approximately 32% of the market, focusing on practicality and cost-effectiveness [7] Competitive Landscape - The fishing tackle industry in China is characterized by a low entry barrier, resulting in a large number of companies, with over 90% being small to medium-sized enterprises, leading to a highly fragmented market [12] - Notable companies include Weihai Guangwei Outdoor Equipment Co., Shandong Handing Sports Goods Co., Ningbo Haiber Group, and others, showcasing innovative products at industry events [12][14] Company Profiles - Weihai Guangwei Outdoor Equipment Co. integrates R&D, production, and sales of fishing rods, reels, baits, and related products, with an annual production capacity of 10 million fishing rods and 10 million reels [15] - Shandong Handing Sports Goods Co. has rapidly grown to become one of the most influential brands in the Chinese fishing tackle industry, maintaining a leading position in online sales and operating over 2,000 franchise stores [16] Development Trends - Future trends in the fishing tackle industry include the proliferation of smart fishing rods, electronic floats, and automatic fishing machines, which utilize sensors and IoT technology to enhance fishing efficiency [19] - There will be a focus on personalized design, such as reducing weight and improving comfort, to meet consumer demands for high-quality living [19] - Chinese fishing tackle companies are expected to emphasize brand building and international expansion, with some capable firms targeting high-end markets to compete with international brands [19]

Core Insights - The global fishing market has exceeded $100 billion, with significant growth in regions like North America and Europe, where fishing is a popular outdoor activity [4][8] - In China, the fishing population exceeds 150 million, with younger demographics increasingly participating in the sport [4] - The leading fishing tackle brand globally is Shimano, which reported revenue of 5.22 billion yuan from fishing gear last year [4] Company Overview - Lexin Outdoor International Co., Ltd. has submitted its prospectus to the Hong Kong Stock Exchange for a second time, aiming to transform from an OEM manufacturer to a brand owner [4] - Lexin Outdoor's performance has declined for three consecutive years, with revenues of 818 million yuan in 2022, 463 million yuan in 2023, and projected 573 million yuan in 2024 [6][11] - The company's net profit decreased from 114 million yuan to 59 million yuan during the same period, indicating a nearly 50% reduction [6] Market Dynamics - The fishing equipment market is projected to reach $160.1 billion in 2024 and grow to $165.8 billion in 2025, with an average growth rate of 3.6% from 2025 to 2033 [8] - Lexin Outdoor's primary business involves fishing chairs, tents, and bags, while the core fishing market is dominated by fishing tackle, which presents a larger market opportunity [10] Competitive Landscape - Lexin Outdoor relies heavily on OEM/ODM business, with over 90% of its revenue coming from this model, making it vulnerable to the loss of major clients [10][17] - The company's revenue from the North American market has plummeted from 18.8% in 2022 to just 3.4% in 2024, highlighting its limited competitiveness in a key market [11] Strategic Initiatives - Lexin Outdoor has attempted to diversify by acquiring brands, such as the UK fishing brand Solar, but self-owned brand revenue remains low, increasing from 35.5 million yuan to 40.6 million yuan from 2022 to 2024 [14] - The company plans to expand its OBM (Original Brand Manufacturer) business by introducing new fishing gear categories and collaborating with more retailers [15] Financial Considerations - Lexin Outdoor's reliance on OEM/ODM revenue is significant, with percentages of 94.1%, 90.2%, 92.3%, and 92.9% for the years 2022 to 2025 [17] - The company distributed a cash dividend of 65 million yuan to its controlling shareholder shortly before its IPO, raising concerns about its financial health given its net profit was below 60 million yuan [20] Future Outlook - The company's ability to become the "first fishing stock" remains uncertain, as it faces numerous challenges, including declining performance and heavy reliance on OEM business [21]

Group 1: Industry Overview - The global fishing market has surpassed $100 billion, with the U.S. being the second-largest outdoor activity after hiking, and Europe spending €10.5 billion annually on fishing activities and related equipment [1] - In China, there are over 150 million fishing enthusiasts, with younger generations becoming the main demographic [1] - The global fishing tackle market is dominated by Shimano, which reported revenue of ¥5.22 billion from fishing tackle last year [1] Group 2: Company Performance - Lexin Outdoor International Co., Ltd. has experienced declining performance, with revenues dropping from ¥818 million in 2022 to ¥463 million in 2023, and net profit halving from ¥114 million to ¥59 million [2][8] - Despite a 27.8% year-on-year revenue increase in the first four months of 2025, overall performance has not returned to pre-pandemic levels [2] - The company's production capacity has significantly decreased, with actual output dropping from 7.93 million units in 2022 to 4.17 million units in 2024 [2] Group 3: Market Dynamics - The global fishing tackle market is projected to grow from $160.1 billion in 2024 to $165.8 billion in 2025, with an average growth rate of 3.6% from 2025 to 2033 [3] - There are approximately 785,000 fishing-related enterprises in China, with over 245,000 new registrations in the first half of 2023, a 109.8% increase compared to the same period in 2022 [3] Group 4: Business Model and Challenges - Lexin Outdoor primarily focuses on fishing chairs, tents, and bags, while the core fishing market is dominated by fishing tackle, which has a retail value of ¥131 billion compared to ¥6.8 billion for fishing equipment [4] - The company relies heavily on OEM/ODM business, with over 90% of its revenue coming from this model, making it vulnerable to the loss of major clients [4][8] - Lexin Outdoor's revenue from North America has plummeted from 18.8% in 2022 to 3.4% in 2024, indicating limited competitiveness in the largest fishing market [6] Group 5: Strategic Initiatives - Lexin Outdoor has attempted to diversify by acquiring brands, such as the British fishing brand Solar, but this has not significantly impacted overall revenue, which remains heavily reliant on OEM [7] - The company plans to expand the Solar brand and its product line, aiming to increase its original brand manufacturing (OBM) business [7] - Despite having over 9,000 SKUs, Lexin Outdoor's patent portfolio is limited, raising concerns about its commitment to product development and future competitiveness [9]

Financial Performance - The company reported a total revenue of 231.1 million yuan for 2024, representing a year-on-year increase of 22.31% compared to 188.9 million yuan in 2023 [1] - The net profit attributable to shareholders increased by 207.52% to 33.49 million yuan from 10.89 million yuan in the previous year [1] - The net profit after deducting non-recurring gains and losses was 31.93 million yuan, up 188.37% from 11.07 million yuan [1] - Basic earnings per share rose to 0.84 yuan, a 188.66% increase from 0.29 yuan [1] Cost and Expenses - Sales expenses for 2024 were 42.83 million yuan, a decrease of 9.89% year-on-year [2] - Research and development expenses amounted to 7.44 million yuan, down 3.63% compared to the previous year [2] Product Segmentation - Revenue from cat food reached 195 million yuan with a gross margin of 43.72% [2] - Revenue from dog food was 10.02 million yuan with a gross margin of 41.94% [2] - Feed revenue was 24.34 million yuan with a gross margin of 39.45% [2] - Other business revenue was 1.66 million yuan with a gross margin of 22.30% [2] Workforce Changes - The total number of employees increased to 270 from 252, with a net addition of 18 employees [3] - Management personnel decreased by 4, while production personnel increased by 20 [3] Leadership and Governance - The chairman Liu Fengqi and vice general manager Guo Fengqin are married, and their son Liu Zhe is the general manager [4][5] - Liu Fengqi has extensive experience in various roles, including as a professor and in management positions within the company [4] - Guo Fengqin has held several engineering and management roles prior to her current position [5] - Liu Zhe has been involved in the company since 2018 and is set to take over as general manager in 2025 [5] Business Overview - The company specializes in the research, production, and sales of freeze-dried pet food, with main products including cat food, dog food, and feed [5]