HK/China Healthcare Analyst (ex-Fosun Pharma)

Xinyao (Criss) Wang

Equity Capital Markets

Ridge Outdoor International / Equity Capital Markets

<ul>
<li>Ridge’s recovery momentum is not yet stable.OBM gross margin is far lower than the level of industry-leading brands, reflecting the weak position of Ridge's business model in the value chain.</li>
<li>Ridge's short-term growth depends on the revival of OEM/ODM business. In the long term, its prospects hinge on the success of its own brand Solar and the high-growth Asian market.</li>
<li>The IPO pricing is HK$11.25-12.25/share, with market value of HK$1.44bn-1.57bn. Based on 2025, 2026, 2027 forecast, P/E is 18.3-20x, 15-16.4x, 12.8-14x respectively.We think the IPO valuation is in reasonable range. </li>
</ul>


Ridge’s recovery momentum is not yet stable.OBM gross margin is far lower than the level of industry-leading brands, reflecting the weak position of Ridge's business model in the value chain.
Ridge's short-term growth depends on the revival of OEM/ODM business. In the long term, its prospects hinge on the success of its own brand Solar and the high-growth Asian market.
The IPO pricing is HK$11.25-12.25/share, with market value of HK$1.44bn-1.57bn. Based on 2025, 2026, 2027 forecast, P/E is 18.3-20x, 15-16.4x, 12.8-14x respectively.We think the IPO valuation is in reasonable range. 


Pre-IPO Pre-IPO Ridge Outdoor International (PHIP Updates) - Some Points Worth the Attention

Global Healthcare Analyst

Tina Banerjee

<ul>
<li>Ridge Outdoor (ROI HK) launched its Hongkong IPO aiming to raise up to HK$ 345.5M. The company plans to sell 28.2M shares at HK$11.25- HK$12.25 per share.</li>
<li>Ridge Outdoor manufactures and sell fishing related equipments, which includes fishing chairs, rod pods, barrows, seatboxes, shoulder bags, fishing backpacks, rod holdalls, bivvies, social bivvies and shelters.</li>
<li>The robust outlook, improving margins and market leader position quite justify the valuation Ridge Outdoor is seeking through this issue.</li>
</ul>


Ridge Outdoor (ROI HK) launched its Hongkong IPO aiming to raise up to HK$ 345.5M. The company plans to sell 28.2M shares at HK$11.25- HK$12.25 per share.
Ridge Outdoor manufactures and sell fishing related equipments, which includes fishing chairs, rod pods, barrows, seatboxes, shoulder bags, fishing backpacks, rod holdalls, bivvies, social bivvies and shelters.
The robust outlook, improving margins and market leader position quite justify the valuation Ridge Outdoor is seeking through this issue.


Ridge Outdoor IPO: Investors Can Gear Up to Fish in This Tranquil Demand Scenario

<ul>
<li>The OEM/ODM model is facing challenges and cannot bring sustainable growth. This business model will lead to a lack of flexibility/innovation ability for Ridge in the face of market changes.</li>
<li>Transition from OEM/ODM to OBM requires high investment of resources in brand incubation/channel restructuring, which will lead to cash flow pressure.We cannot understand the logic behind Ridge's large dividend payout.</li>
<li>Valuation of Ridge could be higher than <a href="https://www.smartkarma.com/entities/yue-yuen-industrial-holdings-limited" target="_blank" data-smartkarma-citation="entities:12281:1" rel="noopener">Yue Yuen </a>but lower than <a href="https://www.smartkarma.com/entities/techtronic-industries-co-ltd" target="_blank" data-smartkarma-citation="entities:4561:1" rel="noopener">Techtronic </a>and <a href="https://www.smartkarma.com/entities/comefly-outdoor-co-ltd" target="_blank" data-smartkarma-citation="entities:30268:1" rel="noopener">Comefly</a>. If the Company’s transformation to OBM business is stagnated, then high valuation is not justified  </li>
</ul>


The OEM/ODM model is facing challenges and cannot bring sustainable growth. This business model will lead to a lack of flexibility/innovation ability for Ridge in the face of market changes.
Transition from OEM/ODM to OBM requires high investment of resources in brand incubation/channel restructuring, which will lead to cash flow pressure.We cannot understand the logic behind Ridge's large dividend payout.
Valuation of Ridge could be higher than Yue Yuen but lower than Techtronic and Comefly. If the Company’s transformation to OBM business is stagnated, then high valuation is not justified  


Pre-IPO Ridge Outdoor International - The OEM/ODM Model Has Become a Burden

China

Comefly Outdoor Co., Ltd. provides apparel. The Company designs, produces, and sells outdoor apparel, footwear, equipment, tents, and other products.

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Comefly Outdoor Co Ltd (603908 CH)

Pre-IPO Pre-IPO Ridge Outdoor International (PHIP Updates) - Some Points Worth the Attention

Ridge’s recovery momentum is not stable, which hinges on OEM/ODM business in short term and success of Solar in long term. IPO pricing is...

Xinyao (Criss) Wang

Ridge Outdoor IPO: Investors Can Gear Up to Fish in This Tranquil Demand Scenario

Ridge Outdoor launches Hong Kong IPO to raise up to HK$345.5M. Robust outlook, improving margins and market leader position quite justify the...

Tina Banerjee

Pre-IPO Ridge Outdoor International - The OEM/ODM Model Has Become a Burden

Transitioning from OEM/ODM to OBM is challenging due to cashflow pressure.If transformation stalls, high valuation is not justified.We don't...

Xinyao (Criss) Wang

Price Gauge

52-week Range

Market Cap (USDm)

P/E

Dividend (Yield)

Pre-IPO Pre-IPO Ridge Outdoor International (PHIP Updates) - Some Points Worth the Attention

Ridge’s recovery momentum is not stable, which hinges on OEM/ODM business in short term and success of Solar in long term. IPO pricing is...

Xinyao (Criss) Wang

Ridge Outdoor IPO: Investors Can Gear Up to Fish in This Tranquil Demand Scenario

​Ridge Outdoor launches Hong Kong IPO to raise up to HK$345.5M. Robust outlook, improving margins and market leader position quite justify the...

Tina Banerjee

Pre-IPO Ridge Outdoor International - The OEM/ODM Model Has Become a Burden

​Transitioning from OEM/ODM to OBM is challenging due to cashflow pressure.If transformation stalls, high valuation is not justified.We don't...

Xinyao (Criss) Wang

Ridge Outdoor launches Hong Kong IPO to raise up to HK$345.5M. Robust outlook, improving margins and market leader position quite justify the...

Transitioning from OEM/ODM to OBM is challenging due to cashflow pressure.If transformation stalls, high valuation is not justified.We don't...