Pan-Asia Catalysts/Events, Quiddity Advisors

David Blennerhassett

Pan-Asia Catalysts/Events

Quiddity Advisors

Event-Driven

Topsports International Holdings / Event-Driven

<ul>
<li>
<strong><a href="https://www.smartkarma.com/entities/topsports-international" target="_blank" data-smartkarma-citation="entities:28153:1" rel="noopener">Topsports International (6110 HK)</a></strong> is trading cheap to peers <a href="https://www.smartkarma.com/entities/anta-sports-products-ltd" target="_blank" data-smartkarma-citation="entities:10261:1" rel="noopener">Anta Sports Products (2020 HK)</a> and <a href="https://www.smartkarma.com/entities/li-ning-co-ltd" target="_blank" data-smartkarma-citation="entities:6047:1" rel="noopener">Li Ning (2331 HK)</a>, and to partners <a href="https://www.smartkarma.com/entities/nike-inc-cl-b" target="_blank" data-smartkarma-citation="entities:6658:1" rel="noopener">Nike (NKE US)</a> and <a href="https://www.smartkarma.com/entities/adidas-ag" target="_blank" data-smartkarma-citation="entities:21578:1" rel="noopener">Adidas AG (ADS GR)</a>.</li>
<li>Like for so many companies in China, the combination of severe lockdown restrictions and global supply chain disruptions has impacted Topsports operations.</li>
<li>Yet forward operational updates may surprise to the upside.  Management appears confident of their "<em>immersive shopping experience</em>" strategy, and recently declared a special dividend for FY22 (Feb Y/E). </li>
</ul>



Topsports International (6110 HK) is trading cheap to peers Anta Sports Products (2020 HK) and Li Ning (2331 HK), and to partners Nike (NKE US) and Adidas AG (ADS GR).
Like for so many companies in China, the combination of severe lockdown restrictions and global supply chain disruptions has impacted Topsports operations.
Yet forward operational updates may surprise to the upside.  Management appears confident of their "immersive shopping experience" strategy, and recently declared a special dividend for FY22 (Feb Y/E). 


Topsports (6110 HK): Upsizing Undervalued Sporting Goods Play

Head of Research, IPOs & Placements, Aequitas Research

Sumeet Singh

Head of Research, IPOs & Placements

IPOs and Placements coverage across Asia Pacific

Aequitas Research

We cover all listing across the Asia Pacific along with follow-up placements. As of Dec 2020, our team had covered 539 IPOs with a hit rate of 73.5% and 685 placements with a hit rate of 66.8%.

We combine fundamental bottom-up views with our proprietary quantitative framework to provide a holistic coverage across new listings and placements. Our coverage includes pre-IPO notes before the deal is launched, follow-up analysis once the deal is live and post-listing trading analysis as well.

<ul>
<li>Topsports International Holdings (TIH) is now trading close to its all time lows, after the shares corrected by 50% over the past year.</li>
<li>The company is one of the largest retailers for <a href="https://www.smartkarma.com/entities/nike-inc-cl-b" target="_blank" data-smartkarma-citation="entities:6658:1" rel="noopener">Nike (NKE US)</a> and <a href="https://www.smartkarma.com/entities/adidas-ag" target="_blank" data-smartkarma-citation="entities:21578:1" rel="noopener">Adidas AG (ADS GR)</a> in China.</li>
<li>Given then on/off lockdowns the near term outlook isn't great, but the stock appears cheap for those willing to take a longer view.</li>
</ul>


Topsports International Holdings (TIH) is now trading close to its all time lows, after the shares corrected by 50% over the past year.
The company is one of the largest retailers for Nike (NKE US) and Adidas AG (ADS GR) in China.
Given then on/off lockdowns the near term outlook isn't great, but the stock appears cheap for those willing to take a longer view.


Topsports International Holdings - Is Cheap Enough to Counter Some of the Risks

HK/China Healthcare Analyst (ex-Fosun Pharma)

Xinyao (Criss) Wang

Equity Bottom-Up

Topsports International Holdings / Equity Bottom-Up

<ul>
<li>Topsports suffered the first decline in performance since FY2018. Besides pandemic outbreaks and inventory shortage due to global supply chain disruption, over-reliance on Nike and Adidas is also the reason.</li>
<li>This is the best opportunity to reduce the number of stores based on “Select+Optimize” strategy. With resumption of sports events and good prospects of China's sports industry, Topsports could rebound.</li>
<li>Topsports is undervalued compared with its peers, but we are now in a complicated macro environment. Share prices may not rise as expected, which should be aware of by investors. </li>
</ul>


Topsports suffered the first decline in performance since FY2018. Besides pandemic outbreaks and inventory shortage due to global supply chain disruption, over-reliance on Nike and Adidas is also the reason.
This is the best opportunity to reduce the number of stores based on “Select+Optimize” strategy. With resumption of sports events and good prospects of China's sports industry, Topsports could rebound.
Topsports is undervalued compared with its peers, but we are now in a complicated macro environment. Share prices may not rise as expected, which should be aware of by investors. 


Topsports International (6110.HK) - Has the Potential to Turn Things Around Despite the Headwinds

HK/China Equity Long-Short

Osbert Tang, CFA

Thematic (Sector/Industry)

<ul>
<li>Infrastructure, new energy, consumer discretionary and, to a lesser extent, transportation and logistics are sectors that will benefit from extensive government economic supportive policies over the last few days. </li>
<li>Acceleration of special purpose bonds will drive <a href="https://www.smartkarma.com/entities/china-communications-construction-co-ltd" target="_blank" data-smartkarma-citation="entities:265:1" rel="noopener">China Communications Construction (1800 HK)</a>. We see <a href="https://www.smartkarma.com/entities/china-longyuan-power-group-corp-ltd" target="_blank" data-smartkarma-citation="entities:14215:1" rel="noopener">China Longyuan Power (916 HK)</a> and <a href="https://www.smartkarma.com/entities/dongfang-electric-corporation-limited" target="_blank" data-smartkarma-citation="entities:1251:1" rel="noopener">Dongfang Electric (1072 HK)</a> benefit from new energy initiatives.</li>
<li>
<a href="https://www.smartkarma.com/entities/li-ning-co-ltd" target="_blank" data-smartkarma-citation="entities:6047:1" rel="noopener">Li Ning (2331 HK)</a> will be the near-term winner in the consumer discretionary space and so as <a href="https://www.smartkarma.com/entities/haier-smart-home-co-ltd-b3ef445f-0f54-4586-8c58-9073de98d60e" target="_blank" data-smartkarma-citation="entities:31105:1" rel="noopener">Haier Smart Home Co Ltd (6690 HK)</a>.</li>
</ul>


Infrastructure, new energy, consumer discretionary and, to a lesser extent, transportation and logistics are sectors that will benefit from extensive government economic supportive policies over the last few days. 
Acceleration of special purpose bonds will drive China Communications Construction (1800 HK). We see China Longyuan Power (916 HK) and Dongfang Electric (1072 HK) benefit from new energy initiatives.

Li Ning (2331 HK) will be the near-term winner in the consumer discretionary space and so as Haier Smart Home Co Ltd (6690 HK).


Roundup of Government Economic Supportive Policies: Key Winners

Equity Capital Markets

Belle International Holdings / Equity Capital Markets

<ul>
<li>Belle Fashion (BF) aims to raise around US$1bn in its Hong Kong listing, which would mark its return to the stock market after five years.</li>
<li>Belle Fashion is the largest China-based fashion footwear and apparel group based on 2020 retail sales value, according to Frost &amp; Sullivan (F&amp;S). </li>
<li>In this note, we'll talk about the not so positive aspects of the deal.</li>
</ul>


Belle Fashion (BF) aims to raise around US$1bn in its Hong Kong listing, which would mark its return to the stock market after five years.
Belle Fashion is the largest China-based fashion footwear and apparel group based on 2020 retail sales value, according to Frost &amp; Sullivan (F&amp;S). 
In this note, we'll talk about the not so positive aspects of the deal.


Belle Fashion Pre-IPO - The Negatives - You'll Stumble in My Footsteps

China

Topsports International Holdings Limited operates as a sports shoes and apparel retailer. The Company sells sports shoes, sports shirts, and other products. Topsports International Holdings markets its products throughout China.

Topsports International Holdings (6110 HK)

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Topsports International Holdings (6110 HK)

Topsports (6110 HK): Upsizing Undervalued Sporting Goods Play

Topsorts is inexpensive versus peers and with to its historical metrics. Provided China does not implement another round of stringent lockdowns,...

David Blennerhassett

Topsports International Holdings - Is Cheap Enough to Counter Some of the Risks

Topsports International Holdings (TIH) is now trading close to its all time lows, after the shares corrected by 50% over the past year.

Sumeet Singh

Topsports International (6110.HK) - Has the Potential to Turn Things Around Despite the Headwinds

Topsports suffered the first performance decline since 2018, but its operational strategy can help it rebound. Topsports is undervalued, but share...

Xinyao (Criss) Wang

Roundup of Government Economic Supportive Policies: Key Winners

We expect the government economic supportive policies released in the last few days to drive the infrastructure, new energy, consumer discretionary...

Osbert Tang, CFA

Belle Fashion Pre-IPO - The Negatives - You'll Stumble in My Footsteps

Belle Fashion aims to raise around US$1bn in its HK listing, which would mark its return to the stock market after five years. In this note, we...

Sumeet Singh

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