Equity Analyst

Steve Zhou, CFA

Equity Bottom-Up

Topsports International Holdings / Equity Bottom-Up

<ul>
<li>
<a href="https://www.smartkarma.com/entities/topsports-international-holdin" target="_blank" data-smartkarma-citation="entities:28153:1" rel="noopener">Topsports International Holdin (6110 HK)</a> is a pure-play on Nike and Adidas retail sales in China, as it is a leading retail partner of Nike and Adidas in China.</li>
<li>Nike's Greater China sales grew 12% yoy during the most recent quarter.  During the earnings call, Nike management was bullish on the prospects of the China business.</li>
<li>The company currently trades at 13x forward PE, with a forward dividend yielf of 7%.  </li>
</ul>



Topsports International Holdin (6110 HK) is a pure-play on Nike and Adidas retail sales in China, as it is a leading retail partner of Nike and Adidas in China.
Nike's Greater China sales grew 12% yoy during the most recent quarter.  During the earnings call, Nike management was bullish on the prospects of the China business.
The company currently trades at 13x forward PE, with a forward dividend yielf of 7%.  


Topsports (6110 HK):  Beneficiary Of An Improving Nike China

<ul>
<li>
<a href="https://www.smartkarma.com/entities/topsports-international-holdings" target="_blank" data-smartkarma-citation="entities:28153:1" rel="noopener">Topsports International Holdings (6110 HK)</a> announced first half FY24 (fiscal year ending February) results last week, with net profit up 17% yoy.</li>
<li>The company trades at a 7% dividend yield, backed by strong free cash flow.</li>
<li>The stock is not only a yield play, but also a call option on the recovery of Nike and Adidas' retail performance in China.</li>
</ul>



Topsports International Holdings (6110 HK) announced first half FY24 (fiscal year ending February) results last week, with net profit up 17% yoy.
The company trades at a 7% dividend yield, backed by strong free cash flow.
The stock is not only a yield play, but also a call option on the recovery of Nike and Adidas' retail performance in China.


Topsports (6110 HK):  High Dividend Yield Supported By Strong Free Cash Flow

HK/China Equity Long-Short

Osbert Tang, CFA

<ul>
<li>The turnaround of sports business at <a href="https://www.smartkarma.com/entities/china-dongxiang-group-co" target="_blank" data-smartkarma-citation="entities:1068:1" rel="noopener">China Dongxiang (3818 HK)</a> is very welcoming. We are glad that sales trend in Oct-Nov is sustained and Phenix brand is well-received.</li>
<li>Reported losses widened as poor market environment enlarged investment losses. However, net cash and investment portfolio are still valued at Rmb8.5bn, or 5.9x its market capitalisation. </li>
<li>CNDX looks comfortably at over 6% full-year dividend yield. Together with just 0.15x P/B, there are enough protections for the downside of the stock.  </li>
</ul>


The turnaround of sports business at China Dongxiang (3818 HK) is very welcoming. We are glad that sales trend in Oct-Nov is sustained and Phenix brand is well-received.
Reported losses widened as poor market environment enlarged investment losses. However, net cash and investment portfolio are still valued at Rmb8.5bn, or 5.9x its market capitalisation. 
CNDX looks comfortably at over 6% full-year dividend yield. Together with just 0.15x P/B, there are enough protections for the downside of the stock.  


China Dongxiang (3818 HK): Turned Around on Sports Business

China Tourism Group Duty Free Corp Ltd / Equity Bottom-Up

<p>We have expressed our positive view on <a href="https://www.smartkarma.com/entities/china-tourism-group-duty-free-corp-ltd" target="_blank" data-smartkarma-citation="entities:12278:1" rel="noopener">China Tourism Group Duty Free Corp Ltd (601888 CH)</a> in various Insights previously. In this Insight, we look at the proposed H-share IPO from the perspective of investors who do not know it well. For seasoned investors in this name, this Insight serves as a summary of our views and provides background details on the proposed IPO.</p><p>Fundamentally speaking, the key positives for CTG Duty Free are: 1.) absolute leadership in China's duty free market, 2.) encouraging growth outlook, and 3.) solid profitability and financial position. Key negatives are: 1.) policy risk and rising competition, 2.) concern on payback of new projects, and 3.) risk of overseas expansion. If the IPO is being priced at the current average H-A discount, it will be on 32.7x FY21F PER, we see this not expensive relative to the premium retailers listed in Hong Kong. </p>

We have expressed our positive view on China Tourism Group Duty Free Corp Ltd (601888 CH) in various Insights previously. In this Insight, we look at the proposed H-share IPO from the perspective of investors who do not know it well. For seasoned investors in this name, this Insight serves as a summary of our views and provides background details on the proposed IPO.Fundamentally speaking, the key positives for CTG Duty Free are: 1.) absolute leadership in China's duty free market, 2.) encouraging growth outlook, and 3.) solid profitability and financial position. Key negatives are: 1.) policy risk and rising competition, 2.) concern on payback of new projects, and 3.) risk of overseas expansion. If the IPO is being priced at the current average H-A discount, it will be on 32.7x FY21F PER, we see this not expensive relative to the premium retailers listed in Hong Kong. 

CTG Duty Free (601888 CH) H-Share Pre-IPO: Fundamentally Speaking

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.

Equity Capital Markets

Sichuan Baicha Baidao Industrial / Equity Capital Markets

<ul>
<li>
<a href="https://www.smartkarma.com/entities/sichuan-baicha-baidao-industrial-co-ltd" target="_blank" data-smartkarma-citation="entities:40029:1" rel="noopener">Sichuan Baicha Baidao Industrial (2555 HK)</a> (SBBI) raised around US$330m in its HK IPO.</li>
<li>SBBI sells new-style tea drinks through its ChaPanda stores. According to F&amp;S, SBBI ranked third in China’s new-style tea shop market with a market share of 6.8% in FY23.</li>
<li>We have looked at the company’s performance and valuations in our past note. In this note, we talk about the trading dynamics.</li>
</ul>



Sichuan Baicha Baidao Industrial (2555 HK) (SBBI) raised around US$330m in its HK IPO.
SBBI sells new-style tea drinks through its ChaPanda stores. According to F&amp;S, SBBI ranked third in China’s new-style tea shop market with a market share of 6.8% in FY23.
We have looked at the company’s performance and valuations in our past note. In this note, we talk about the trading dynamics.


Sichuan Baicha Baidao IPO Trading - Tepid Demand, While Peers Have Corrected

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): Beneficiary Of An Improving Nike China

Topsports International (6110 HK) is a play on improving Nike sales in China, trading at 13x forward PE and 7% forward dividend yield.

Steve Zhou, CFA

Topsports (6110 HK): High Dividend Yield Supported By Strong Free Cash Flow

Topsports is not only a yield play, but also a call option on the recovery of Nike and Adidas' retail performance in China, which have been...

Steve Zhou, CFA

China Dongxiang (3818 HK): Turned Around on Sports Business

Along with the encouraging 3Q FY24 (Oct-Dec 2023) sportswear sales - Kappa brand sales up mid 40%–50% YoY, China Dongxiang has benefited from the...

Osbert Tang, CFA

Sichuan Baicha Baidao IPO Trading - Tepid Demand, While Peers Have Corrected

Sichuan Baicha Baidao Industrial (2555 HK) (SBBI) raised around US$330m in its HK IPO. In this note, we talk about the trading dynamics.

Sumeet Singh

Price Gauge

52-week Range

Market Cap (USDm)

P/E

Dividend (Yield)

Topsports (6110 HK): Beneficiary Of An Improving Nike China

​Topsports International (6110 HK) is a play on improving Nike sales in China, trading at 13x forward PE and 7% forward dividend yield.

Steve Zhou, CFA

Topsports (6110 HK): High Dividend Yield Supported By Strong Free Cash Flow

Topsports is not only a yield play, but also a call option on the recovery of Nike and Adidas' retail performance in China, which have been...

Steve Zhou, CFA

China Dongxiang (3818 HK): Turned Around on Sports Business

Along with the encouraging 3Q FY24 (Oct-Dec 2023) sportswear sales - Kappa brand sales up mid 40%–50% YoY, China Dongxiang has benefited from the...

Osbert Tang, CFA

CTG Duty Free (601888 CH) H-Share Pre-IPO: Fundamentally Speaking

In relation to CTG Duty Free's H-share IPO, key positives are: 1.) absolute leadership in China's duty free market, 2.) encouraging growth outlook,...

Osbert Tang, CFA

Sichuan Baicha Baidao IPO Trading - Tepid Demand, While Peers Have Corrected

Sichuan Baicha Baidao Industrial (2555 HK) (SBBI) raised around US$330m in its HK IPO. In this note, we talk about the trading dynamics.

Sumeet Singh

Topsports International (6110 HK) is a play on improving Nike sales in China, trading at 13x forward PE and 7% forward dividend yield.