The Sportswear Market Is Divided In The "Hot" Market.

This year, sports apparel listed companies are particularly eye-catching in the capital market. The head effect of consumer brands is more and more obvious. However, the "hot" market is also differentiated, which is the overall situation of the sports apparel industry.

Anta sports market capitalization exceeds HK $200 billion

In October 16th, Anta sports released the latest business performance announcement in the third quarter of 2019. In the third quarter of 2019, the retail sales of Anta brand products (calculated by retail value) compared with the same period in 2018, recorded a growth in the middle of 10%-20%. The retail sales of FILA brand (calculated at retail price) compared with the same period in 2018, the growth of 50%-55% was recorded. The retail sales of other brands (at retail value) compared with the same period in 2018, the growth of 30%-35% was recorded. The announcement indicates that the disclosure is only related to the group's Anta FILA, DESCENTE, KOLON SPORT, SPRANDI and KINGKOW brand businesses, and does not include Amer Sports Corporation business.

Anta sports 2019 semi annual report shows that the first half of the company achieved operating income of 14 billion 811 million yuan, an increase of 40.3% over the previous year, operating profit of 4 billion 257 million yuan, an increase of 58.4% over the same period; the profit attributable to shareholders was 2 billion 483 million yuan, an increase of 27.7% over the same period last year. The company said the above three indicators were all new high, and maintained nearly 20% growth every six years. Semi annual report shows that the first half of the group's revenue came mainly from the core division Anta, which accounted for 51.2% of the total revenue, an increase of 18.3% over the same period, mainly due to the increase in market awareness of Anta brand and its products, led to the growth of Anta's brand income, and the significant increase in Anta's child earnings. The FILA Division has accounted for 44.1% of the group's overall revenue, up 79.9% compared to the same period last year, mainly due to the improvement of the market awareness of FILA brand and its products, the strong performance of the retail business as well as the increase of the physical store and the improvement of the store efficiency, as well as the development of the electricity supplier.

Anta sports has gone all the way this year, and its market value has exceeded 200 billion Hong Kong dollars recently, a record high. By the end of October 18, 2019, Anta sports shares were priced at HK $73.15 and the market value was HK $197 billion 600 million.

Lining has risen more than 200% this year.

Anta sports market value is far ahead of the clothing listed companies. Lining has become the most attractive sports apparel listed company this year. Since the beginning of the year, Lining's stock price has increased by more than 200%. By the end of October 18, 2019, Lining's stock price was HK $26.70, and its market value was HK $55 billion 759 million.

Lining's 2019 semi annual report showed that the company's revenue in the first half reached 6 billion 255 million yuan, an increase of 32.7% over the same period in 2018. Lining said that the reason for the sharp increase in revenue is that the channels have increased substantially. The franchisee's confidence in Lining brand has been enhanced. The group has transferred some of its original stores to distributors, and has agreed to set up big stores and fashion shops, so that the revenue of the franchisee has increased by 40%. By the influence of the transfer of some stores, the sales revenue has slightly slowed down, but there is still a growth rate of more than 10%. As well as the rapid development of the electricity supplier channel in recent years, the proportion of revenue has increased, showing a 30% high growth.

The semi annual report shows that Lining's net profit of equity holders in the first half of the year was 795 million yuan, up 196% over the same period, and the net interest rate of the company increased from 5.7% to 12.7%. Lining said that the sales revenue and gross profit margin of the group both increased, the cost rate decreased, other income and other income increased, and the share of the investment profit that was accounted for by the equity method increased significantly, so the comprehensive profit index in the first half of this year has improved significantly. Lining said that in the first half of the year, the company continued to focus on products, channels and retail operations as well as supply chain management as the main business focus, and launched the strategy of "single brand, multi category and multi-channel", emphasizing the professional sports attributes of the product, integrating professional sports with the trend culture, and continuing to take the five major categories, including basketball, running, training, badminton and sports fashion as the core.

XTEP international retail sales growth slowed in September

Compared with Anta sports and Lining, another sportswear brand XTEP International's recent performance and share price performance is slightly "stable". In October 17th, XTEP International announced the announcement of the third quarter of mainland China's business operation in 2019. The announcement shows that XTEP international sales in the third quarter of the same quarter increased by about 10% in the third quarter, while retail sales (including online and offline channels) increased by 20% over the same period, the retail discount level was 25% off to 22% off, and the turnover of retail inventories was about four months.

According to the announcement, the growth of retail sales of XTEP brand products in July 2019 and August showed a steady growth compared with the first half of the year, and sales of clothing products increased better than those of footwear products. In September 2019, the growth of retail sales slowed down, mainly due to the high sales base and the warm autumn in northern China. XTEP brand retail outlets have launched the autumn and winter products series, and the warm weather has affected its sales performance. However, sales growth has resumed recently, and sales in the first two weeks of October 2019 have returned to their previous level of growth.

XTEP international 2019 semi annual report shows that the first half of the company achieved revenue of 3 billion 357 million yuan, an increase of 23% over the same period, and the profit margin of shareholders was 463 million yuan, an increase of 23.4% over the same period last year. XTEP International said that revenue growth was due to product mix and acceptability (especially clothing products), resulting in higher sales rate and increased replenishment orders from total agents. Two is a supplementary demand for healthier stock levels; three, sales growth of downstream retailers is due to upgrading of stores and optimization of retail networks.

By the end of October 18, 2019, XTEP International's share price was HK $4.69, up 15.77% from the beginning of the year, and its market value was HK $10 billion 582 million.

Since the listing, the stock price has risen by more than 20%.

In October 10, 2019, BELLE International's International Holdings Limited was officially listed on the HKEx, with an issue price of HK $8.5. As of the end of the day, surging shares rose 8.82%, with a total market value of HK $57 billion 400 million. Since the listing, the stock price has been on the rise. As of the end of October 18, 2019, its stock price was HK $10.28 and its market value was HK $57 billion 533 million.

Tun Po is a sports line that was split by BELLE international, a Hong Kong Footwear Company. The prospectus shows that the company operates a sports retail and service platform in China. As of September 17, 2019, the company has 8372 direct outlets and 1103 downstream retailers operating 1957 entities, including two online downstream retailers running their online retail platforms.

According to the prospectus, according to frost Sullivan's data, the company is China's largest footwear retailer in terms of retail sales, and its market share in China's sports footwear retail market in 2018 was 15.9%. At the end of 2018, the company's direct store was the most popular sports shoes and apparel product retail network in China. Currently, Nike is the second largest retail partner and customer in the world. It is also Adidas's largest retail partner and customer in the world. The company also collaborated with Puma, CONVERSE and Wei Fu Group's brands (namely, fan, The North Face and Tim Pak LAN), Reebok, Arthur, ghost grave tiger and Skech.

The prospectus shows that the increase in income from the 21 billion 690 million yuan in the year ended February 28, 2017 to 32 billion 564 million yuan in the year ended February 28, 2019, a compound annual growth rate of 22.5%, and net profit increased from 1 billion 317 million yuan in the year ended February 28, 2017 to 2 billion 200 million yuan in February 28, 2019 as of February 28, 2019, with a compound annual growth rate of 29.2%.

Baosheng international performance highlights

As another large sports shoes and clothing retail listed company, Baosheng international first half year's performance has achieved a double profit growth in revenue and net profit. The stock price has increased by more than 80% since the beginning of the year, and its market value is approaching the all-time high. By the end of October 18, 2019, Baosheng international stock price was HK $2.75, and its market value was HK $13 billion 294 million.

In October 14th, Baosheng International announced that the net income of the company in September was 2 billion 396 million yuan, an increase of 15.09% over the same period last year. The net income of the consolidated operating income in the first 9 months of this year was 19 billion 997 million yuan, up 20.19% over the same period last year. Baosheng international semi annual report 2019 showed that the company's revenue in the first half of the year was 13 billion 372 million yuan, an increase of 19.4% over the same period last year, and the company owner should account for 427 million yuan profit, an increase of 39.3% over the same period last year. Baosheng International said the growth was attributed to China's trend in sports and leisure activities and the participation rate of sports activities, the continuous development of group retail business and the rapid growth of online business.

Half year report shows that as of the end of June 2019, Baosheng international has 5895 direct retail outlets and 3756 franchise stores. Baosheng International said that the rise in consumer spending coupled with the accelerated development of sports and leisure trends, such as the increasing attention paid by the Chinese people to fitness and health, the increase in the participation rate of sports activities, the increase in the number of sports service orders, and the support of government policies, made the group optimistic about the demand for sports apparel and sports services in China to continue to grow substantially. The group will continue to focus on setting up and upgrading stores that offer rich experience and upgrading online channels, while planning to open a new large store that can better integrate store sports services and network elements with online products and other sales channels.

Yuyuan group has fallen nearly 10% since the beginning of the year.

As Baosheng International's parent company, Yuyuan group, a sports footwear manufacturer, is no better than Baosheng international in terms of performance and share price performance. Yuyuan group issued a notice in October 14th. In September 2019, the net profit of the company's consolidated operating income, which is equivalent to total sales, reduced sales discount and sales returns, was 823 million US dollars, a decrease of 1.9% compared with the same period last year. The total net operating income of the company in the 9 months ended September 30, 2019 was 7 billion 520 million US dollars, up 5.13% over the same period last year.

Yuyuan group's semi annual report in 2019 showed that as of the 6 months ended June 30, 2019, the company's income was $5 billion 71 million, an increase of 6.32% over the same period last year, and the company's owners should earn 166 million dollars in profit, up 10.52% from the same period last year. Yuyuan group said that in the first half of the year, the group faced various adversities, especially the United States threat to impose tariffs on shoes made in China, and many customers changed their purchasing strategies under the uncertain factors of Global trade friction, which accelerated the pace of adjusting the capacity of the country in the first half of the year. The group also continued to face the business shocks and challenges caused by brand customers' demand for more flexible purchasing methods and changes in consumer preferences, which resulted in more volatile orders, unstable capacity utilization, lower productivity and complex product mix in the first half of the year. To cope with these challenges and consolidate the long-term position of the group, the group continued to accelerate the implementation of automated production and enhance operational efficiency through the reorganization process.

Half year report shows that compared with the same period last year, Yuyuan group's gross margin of manufacturing business dropped by 0.7 percentage points to 18.1%. The group said that the decline in gross margin of manufacturing business was mainly due to the trend of "retro trend", which led to the more complex process of products and the transfer of production facilities among different countries. The challenges brought by the group to invest in optimizing manufacturing business to achieve sustainable growth (including upgrading automation level and importing SAP enterprise resource planning system) have led to temporary inefficient problems in some production facilities.

By the end of October 18, 2019, Yuyuan group's share price was HK $21.40, down 8.35% from the beginning of the year, and its market value was HK $31 billion 137 million.

　　 The sportswear market is divided in the "hot" market.

This year, the performance of sports apparel listed companies in the capital market is quite bright. The market value of Anta sports has exceeded 200 billion Hong Kong dollars for the first time, and the stock price of Lining has risen two times since the beginning of the year. Since the listing, the stock price has risen by over 20%. Baosheng international stock price has increased by more than 80% since the beginning of the year, and its market value is approaching the all-time high. However, Yuyuan group, its parent company, has fallen nearly 10% since the beginning of the year.

The listed companies of these sports apparel can be regarded as the top revenue enterprises. Generally speaking, Anta sports and Lining as the head of the domestic sportswear brands, their stock performance can be the most powerful. As the international sportswear retailer, their stock price is not as strong as that of the domestic sportswear brands, but the performance is also quite bright. Yuyuan group as the international sportswear foundry manufacturer, the head enterprise is most obviously affected by the external market environment, and the stock price performance is quite weak this year.

On the whole, sportswear is the most brilliant segment of the clothing industry this year. Some of the head enterprises are even "hot" in the capital market. However, from the perspective of the industry, we can see that the domestic sports apparel brands are rising vigorously, and the international sportswear retailers' market performance is quite good. In general, the consumption end of sports apparel industry is better than that of manufacturing end, while the head effect of consumer brand is more obvious, and the market "hot" is differentiated, which is the overall situation of sports apparel industry.