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>Thanks to the rather distressed valuation at just 14x FY24E P/E (our TP is based on 19x P/E, even 1 s.d. below its 5-year average of 28x), we maintain BUY on Li Ning.</li><li>We are still cautious about its retail sales growth trend (because the brand popularity might has declined recently and its products are not as value as before) but we do appreciate Li Ning’s efforts to de-stock its inventory in both the channel and trade fair orders, in order to reset the channel health and investors’ expectations.</li><li>Li Ning reported fairly weak retail sales growth in 3Q23</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.

Thanks to the rather distressed valuation at just 14x FY24E P/E (our TP is based on 19x P/E, even 1 s.d. below its 5-year average of 28x), we maintain BUY on Li Ning.We are still cautious about its retail sales growth trend (because the brand popularity might has declined recently and its products are not as value as before) but we do appreciate Li Ning’s efforts to de-stock its inventory in both the channel and trade fair orders, in order to reset the channel health and investors’ expectations.Li Ning reported fairly weak retail sales growth in 3Q23Content 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.

Li Ning (2331 HK) – Value Is Distressed but End Demand Is Key

<ul><li>1H23 result was a slight miss, but the inventory level, retail sales growth and FY23E guidance update were all better than expected.</li><li>Given the weakened demand, risks of higher retail discounts, potential operating deleverage, we had revied down our forecasts.</li><li>However, since current valuation is not demanding and some negatives were kind of priced in already, we are still rating it BUY.</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 result was a slight miss, but the inventory level, retail sales growth and FY23E guidance update were all better than expected.Given the weakened demand, risks of higher retail discounts, potential operating deleverage, we had revied down our forecasts.However, since current valuation is not demanding and some negatives were kind of priced in already, we are still rating it BUY.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.

Li Ning (2331 HK) – Reiterated Guidance but We Remained Cautious

Thematic (Sector/Industry)

<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

<ul><li>Even though Li Ning started the year slow, both retail sales growth and retail discounts got much better going into Mar-Apr 2023.</li><li>Hence, we are now even more certain about the turnaround in 2Q23E-2H23E. Maintain BUY. 1Q23 was a slight beat.</li><li>Li Ning’s retail sales grew by MSD YoY in 1Q23, beating CMBI est. of 2%. We believe the major surprises are: 1) robust offline growth since Mar 2023 (accelerated to 25%-30%, vs MSD in Jan-Feb) and 2) turnaround in e-commerce (resumed to +ve since Mar 2023). </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.

Even though Li Ning started the year slow, both retail sales growth and retail discounts got much better going into Mar-Apr 2023.Hence, we are now even more certain about the turnaround in 2Q23E-2H23E. Maintain BUY. 1Q23 was a slight beat.Li Ning’s retail sales grew by MSD YoY in 1Q23, beating CMBI est. of 2%. We believe the major surprises are: 1) robust offline growth since Mar 2023 (accelerated to 25%-30%, vs MSD in Jan-Feb) and 2) turnaround in e-commerce (resumed to +ve since Mar 2023). 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.

Li Ning (2331 HK) – A strong comeback in all channels since Mar

<ul><li>We find YTD retail sales and FY23E guidance a miss (even vs our sell-side leading bearish view).</li><li>However, we believe the share price has already priced in the miss (after the drop on Friday).</li><li>With the turnaround ahead, we still rate it BUY.</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.

We find YTD retail sales and FY23E guidance a miss (even vs our sell-side leading bearish view).However, we believe the share price has already priced in the miss (after the drop on Friday).With the turnaround ahead, we still rate it BUY.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.

Li Ning (2331 HK) – A conservative guidance but is priced in

China

Li Ning Company Limited researches, designs, manufactures, distributes, and retails sports footwear, apparel and accessories for sport and leisure use.

Li Ning (2331 HK)

Li Ning (2331 HK) – Value Is Distressed but End Demand Is Key

Thanks to the rather distressed valuation at just 14x FY24E P/E (our TP is based on 19x P/E, even 1 s.d. below its 5-year average of 28x), we...

CMB International

Li Ning (2331 HK) – Reiterated Guidance but We Remained Cautious

1H23 result was a slight miss, but the inventory level, retail sales growth and FY23E guidance update were all better than expected.

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

Li Ning (2331 HK) – A strong comeback in all channels since Mar

Even though Li Ning started the year slow, both retail sales growth and retail discounts got much better going into Mar-Apr 2023.

CMB International

Li Ning (2331 HK) – A conservative guidance but is priced in

We find YTD retail sales and FY23E guidance a miss (even vs our sell-side leading bearish view). However, we believe the share price has already...

CMB International