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>The sportswear industry remains under great pressure, but we believe Xtep is still one of a few brands that can mildly outperform and improve sequentially in 2H24E, because of: 1) successful new product launches such as the 360X</li><li>2) robust e-commerce sales growth (esp. the Douyin platform)</li><li>3) wholesale business nature (therefore drags from operating deleverage is limited)</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 sportswear industry remains under great pressure, but we believe Xtep is still one of a few brands that can mildly outperform and improve sequentially in 2H24E, because of: 1) successful new product launches such as the 360X2) robust e-commerce sales growth (esp. the Douyin platform)3) wholesale business nature (therefore drags from operating deleverage is limited)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.

Xtep (1368 HK) - Cautiously Optimistic After a Resilient 2Q24

Asian Hedge Fund Manager, Long Short Equity, Macro

David Mudd

Hua Hong Semiconductor / Equity Bottom-Up

<ul>
<li>After hitting a low point in Q4 2023, Research on Hong Kong companies has been slow to pick up reflecting the ongoing skepticism from investors. </li>
<li>Reports on the large China tech companies dominated the top ten companies covered over the last couple of years and in the first half of 2024.</li>
<li>As China continues to dominate and make news in the global EV market, research in that sector has picked up.</li>
</ul>


After hitting a low point in Q4 2023, Research on Hong Kong companies has been slow to pick up reflecting the ongoing skepticism from investors. 
Reports on the large China tech companies dominated the top ten companies covered over the last couple of years and in the first half of 2024.
As China continues to dominate and make news in the global EV market, research in that sector has picked up.


BUY/SELL/HOLD: China/Hong Kong Stock Updates (July 8th)

<ul><li>Overall, we find the arrangement accretive (thus revising up FY24E-26E NP by 2% to 5%) for Xtep in the short run and turn more positive on its near-term outlook.</li><li>With its rather undemanding valuation (10x FY24E P/E and 14% yield), we maintain BUY with a new TP of HK$7.63, based on 14x FY24E P/E.</li><li>Mr. Ding has proposed to buy K&amp;P and reshuffle the deal with Hillhouse; special dividend will also be paid.</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.

Overall, we find the arrangement accretive (thus revising up FY24E-26E NP by 2% to 5%) for Xtep in the short run and turn more positive on its near-term outlook.With its rather undemanding valuation (10x FY24E P/E and 14% yield), we maintain BUY with a new TP of HK$7.63, based on 14x FY24E P/E.Mr. Ding has proposed to buy K&amp;P and reshuffle the deal with Hillhouse; special dividend will also be paid.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.

Xtep (1368 HK) - Huge Boost in Short-Run Growth with High Yield

Analyst

Steve

<ul>
<li>
<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>, <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 <a href="https://www.smartkarma.com/entities/xtep-international-holdings" target="_blank" data-smartkarma-citation="entities:18118:1" rel="noopener">Xtep International (1368 HK)</a> have announced 1Q24 operational updates, with additional color given in post conference calls.  </li>
<li>Anta: Retail sales started to accelerate in mid-March, and March were better than January and February. </li>
<li>Li Ning:  offline retail sales down low-single-digit in 1Q24, driven by wholesale down mid-single-digit, while retail grew mid-single-digit.  E-commerce grew 20-30% yoy.  </li>
</ul>



Anta Sports Products (2020 HK), Li Ning (2331 HK), and Xtep International (1368 HK) have announced 1Q24 operational updates, with additional color given in post conference calls.  
Anta: Retail sales started to accelerate in mid-March, and March were better than January and February. 
Li Ning:  offline retail sales down low-single-digit in 1Q24, driven by wholesale down mid-single-digit, while retail grew mid-single-digit.  E-commerce grew 20-30% yoy.  


Anta/Li Ning/Xtep:  China Sportswear 1Q24 Update

<ul><li>1Q24 operating numbers were in line with both market and our expectation.</li><li>But we have started to see retail sales growth acceleration since late-Mar 2024, after the launches of more entry-level or value-for-money products like the 360X running shoes.</li><li>With that and the boost from e-commerce channel, we believe the company’s guidance of faster growth, better discounts, and better inventory level from 2Q24E onward is achievable. </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.

1Q24 operating numbers were in line with both market and our expectation.But we have started to see retail sales growth acceleration since late-Mar 2024, after the launches of more entry-level or value-for-money products like the 360X running shoes.With that and the boost from e-commerce channel, we believe the company’s guidance of faster growth, better discounts, and better inventory level from 2Q24E onward is achievable. 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.

Xtep (1368 HK) - Steady Recovery Shall Continue with High Yield

China

Xtep International Holdings Ltd. designs, manufactures, and markets sportwear. The Company produces footwear, apparel, and accessories.

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Xtep International (1368 HK)

Xtep (1368 HK) - Cautiously Optimistic After a Resilient 2Q24

The sportswear industry remains under great pressure, but we believe Xtep is still one of a few brands that can mildly outperform and improve...

CMB International

BUY/SELL/HOLD: China/Hong Kong Stock Updates (July 8th)

Tech NEV companies continue to dominate the research landscape for Hong Kong coverage. Bosideng, China Water Affairs, Topsports, BYD and Xiaomi...

David Mudd

Xtep (1368 HK) - Huge Boost in Short-Run Growth with High Yield

Overall, we find the arrangement accretive (thus revising up FY24E-26E NP by 2% to 5%) for Xtep in the short run and turn more positive on its near...

CMB International

Anta/Li Ning/Xtep: China Sportswear 1Q24 Update

Anta Sports (2020 HK), Li Ning (2331 HK), and Xtep International (1368 HK) have announced 1Q24 operational updates, with additional color given in...

Steve

Xtep (1368 HK) - Steady Recovery Shall Continue with High Yield

With that and the boost from e-commerce channel, we believe the company’s guidance of faster growth, better discounts, and better inventory level...

CMB International

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