Core Viewpoint - The report from Guosheng Securities indicates that the high-performance outdoor apparel market in mainland China is expected to grow at a compound annual growth rate (CAGR) of 16% from 2024 to 2029, signaling a shift towards a more specialized and diversified development phase in the domestic sportswear market [1][4]. Industry Analysis - The sports industry in the U.S. and Japan has seen significant growth due to a combination of historical factors, including economic recovery, increased consumer spending, and government policies that promote sports participation. This has led to a resilient demand for sports apparel, with U.S. gym memberships rising by 3.7% to 68.9 million in 2022 and outdoor activity participation increasing by 4.1% in 2023 [2]. - In China, the participation in running and outdoor activities has surged since 2022, driven by heightened health awareness. The high-performance outdoor apparel market is projected to grow at a CAGR of 16% from 2024 to 2029, indicating a trend towards more specialized and diverse consumer needs [4]. Competitive Factors - For international sports brands like Nike and Adidas, product strength and brand value are crucial for development. Nike is currently in a destocking phase, while Adidas is benefiting from a strong product strategy that includes the development of professional sports products and effective marketing campaigns [3]. - Domestic sports brands in China are increasingly focusing on product and brand-driven expansion. Companies like Anta, Li Ning, and Xtep are investing 2-3% of their revenue in R&D, leading to significant advancements in professional products. Brand image is further enhanced through sponsorship of professional events and athletes [4]. Recommended Companies - Anta Sports (02050) is highlighted for its strong performance and group operational capabilities, with a projected PE ratio of 18 times for 2025. - Li Ning (02331) is recommended for its long-term earnings potential, with a projected PE ratio of 17 times for 2025. - Xtep International (01368) is noted for its leading position in the running sector, with a stable performance from its main brand and growth potential from its new brand Saucony, projected at a PE ratio of 11 times for 2025. - Other companies to watch include 361 Degrees (01361) and Tabo (06110) [5].