External broker reports(aggregated public sources), CMB International

CMB International

External broker reports(aggregated public sources)

Incorporated in Hong Kong, supported by the mainland and targeting in global market, CMB International Capital Corporation Limited (“CMBI”) is an integrated financial institution providing comprehensive and professional services. As a wholly-owned subsidiary of China Merchants Bank ("CMB"), by leveraging on the Group’s synergy and coordination in domestic and overseas markets, as well as CMB’s strong resources and outstanding social reputation, CMBI and its subsidiaries have been actively implementing diversified business strategies and set up an overall layout of main business segments including Corporate Finance, Asset Management, Wealth Management, Global Markets and Structured Finance, etc. Adhering to the philosophy of “being clients oriented and increasing our own values by the way of creating value for clients”, CMBI endeavors to provide quality and integrated financial services to institutional, corporate and individual customers both domestic and overseas including Hong Kong IPO sponsorship and underwriting, share placement and rights issue for listed companies, financial advisors, bonds issuance services, asset management, direct investment, wealth management, equity sales and trading, etc.

Equity Bottom-Up

<ul><li>Retail sales growth in 1Q24 was slow, but it was widely expected.</li><li>We see FY24E growth supported by: 1) healthy momentum in late Mar, 2) an exciting product launch pipeline, 3) further segmentation by Anta in terms of products and store format, and 4) gradual improvement in retail discounts (rather achievable for e-commerce).</li><li>We maintain BUY and continue to see Anta as our sportswear sector top pick. It is trading at 16x FY24E P/E, undemanding given its turnaround trend.</li></ul>Content is external broker report sourced from online content aggregator through publicly available sources and is displayed below for general informational purposes only. Refer full disclaimer below.

Retail sales growth in 1Q24 was slow, but it was widely expected.We see FY24E growth supported by: 1) healthy momentum in late Mar, 2) an exciting product launch pipeline, 3) further segmentation by Anta in terms of products and store format, and 4) gradual improvement in retail discounts (rather achievable for e-commerce).We maintain BUY and continue to see Anta as our sportswear sector top pick. It is trading at 16x FY24E P/E, undemanding given its turnaround trend.Content is external broker report sourced from online content aggregator through publicly available sources and is displayed below for general informational purposes only. Refer full disclaimer below.

Anta Sports (2020 HK) - An Inline 1Q24 Plus an Improving Outlook

<ul><li>1H23 results was a strong beat primarily driven by FILA’s robust OP margin and the limited A&amp;P expenses.</li><li>Retail sales growth in May-Aug 2023 could still be weak but margin improvement should continue and we have now turned more positive.</li><li>Current valuation of 20x FY23E P/E is not too demanding.</li></ul>Content is external broker report sourced from online content aggregator through publicly available sources and is displayed below for general informational purposes only. Refer full disclaimer below.

1H23 results was a strong beat primarily driven by FILA’s robust OP margin and the limited A&amp;P expenses.Retail sales growth in May-Aug 2023 could still be weak but margin improvement should continue and we have now turned more positive.Current valuation of 20x FY23E P/E is not too demanding.Content is external broker report sourced from online content aggregator through publicly available sources and is displayed below for general informational purposes only. Refer full disclaimer below.

Anta Sports (2020 HK) – Costs Control and Efficiency Gains Are the Keys

<ul><li>2Q23 results was a slight beat with 1) inline retail sales growth (Anta was a miss but FILA and other brands had a beat) and 2) a better-than-expected retail discounts.</li><li>Since retail sales growth in Jun-Jul 2023 were similar and still weak, we think sales and earnings could remain at risk.</li><li>However, after massive derating since May 2023, current valuation of 23x FY23E P/E is not too demanding. </li></ul>Content is external broker report sourced from online content aggregator through publicly available sources and is displayed below for general informational purposes only. Refer full disclaimer below.

2Q23 results was a slight beat with 1) inline retail sales growth (Anta was a miss but FILA and other brands had a beat) and 2) a better-than-expected retail discounts.Since retail sales growth in Jun-Jul 2023 were similar and still weak, we think sales and earnings could remain at risk.However, after massive derating since May 2023, current valuation of 23x FY23E P/E is not too demanding. Content is external broker report sourced from online content aggregator through publicly available sources and is displayed below for general informational purposes only. Refer full disclaimer below.

Anta Sports (2020 HK) – A Slight Beat in 2Q23 but Outlook Is Still Fragile

Thematic (Sector/Industry)

<ul><li>The 5-1 golden week holidays remain mixed, sales growth is resilient but the underlying are weak (traffic, ASP, discounts and margins), hence we stay conservative on the 2Q24E outlook.</li><li>Overall speaking, with the weak macro environment (e.g. dilution from outbound tourism, property prices and unemployment concerns), achieving such tourism sales growth (at roughly 7.6% YoY) and retail sales growth (at around 6.8% YoY) are already satisfying.</li><li>However, overhangs such as: 1) weak purchasing power per person, 2) drags on margin due to price wars and 3) potentially weak post holidays consumptions are still there. </li></ul>Content is external broker report sourced from online content aggregator through publicly available sources and is displayed below for general informational purposes only. Refer full disclaimer below.

The 5-1 golden week holidays remain mixed, sales growth is resilient but the underlying are weak (traffic, ASP, discounts and margins), hence we stay conservative on the 2Q24E outlook.Overall speaking, with the weak macro environment (e.g. dilution from outbound tourism, property prices and unemployment concerns), achieving such tourism sales growth (at roughly 7.6% YoY) and retail sales growth (at around 6.8% YoY) are already satisfying.However, overhangs such as: 1) weak purchasing power per person, 2) drags on margin due to price wars and 3) potentially weak post holidays consumptions are still there. Content is external broker report sourced from online content aggregator through publicly available sources and is displayed below for general informational purposes only. Refer full disclaimer below.

Consumer Discretionary - Cautiously Optimistic After a Mixed Golden Week

<ul><li>On one hand, retail sales growth in 5-1 Golden Week was a beat (after a soft Feb-Mar and an inline Apr).</li><li>On the other hand, retail discounts surprisingly widened due to increased competition from the de-stocking by brands like Adidas and Li Ning.</li><li>While fundamentals (sales, discounts and inventory) are trending good into 2H23E and setting up for a decent FY24E, we should still keep our eyes on the end demand and intensity of competition. </li></ul>Content is external broker report sourced from online content aggregator through publicly available sources and is displayed below for general informational purposes only. Refer full disclaimer below.

On one hand, retail sales growth in 5-1 Golden Week was a beat (after a soft Feb-Mar and an inline Apr).On the other hand, retail discounts surprisingly widened due to increased competition from the de-stocking by brands like Adidas and Li Ning.While fundamentals (sales, discounts and inventory) are trending good into 2H23E and setting up for a decent FY24E, we should still keep our eyes on the end demand and intensity of competition. Content is external broker report sourced from online content aggregator through publicly available sources and is displayed below for general informational purposes only. Refer full disclaimer below.

China Sportswear Sector – 5-1 sales beat but competition intensified

China

ANTA Sports Products Limited designs, develops, manufactures, and markets sportswear, including sports footwear and apparel for professionals and the general public.

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Anta Sports Products (2020 HK)

Anta Sports (2020 HK) - An Inline 1Q24 Plus an Improving Outlook

We maintain BUY and continue to see Anta as our sportswear sector top pick. It is trading at 16x FY24E P/E, undemanding given its turnaround trend.

CMB International

Anta Sports (2020 HK) – Costs Control and Efficiency Gains Are the Keys

Retail sales growth in May-Aug 2023 could still be weak but margin improvement should continue and we have now turned more positive.

CMB International

Anta Sports (2020 HK) – A Slight Beat in 2Q23 but Outlook Is Still Fragile

2Q23 results was a slight beat with 1) inline retail sales growth (Anta was a miss but FILA and other brands had a beat) and 2) a better-than...

CMB International

Consumer Discretionary - Cautiously Optimistic After a Mixed Golden Week

The 5-1 golden week holidays remain mixed, sales growth is resilient but the underlying are weak (traffic, ASP, discounts and margins), hence we...

CMB International

China Sportswear Sector – 5-1 sales beat but competition intensified

While fundamentals (sales, discounts and inventory) are trending good into 2H23E and setting up for a decent FY24E, we should still keep our eyes...

CMB International

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