2024Q1 e-commerce performed well, with strong performance from other brands, maintaining the 2024Q1 business performance released by the “Buy” rating company. The 2024Q1 Anta main brand turnover growth, FILA high order growth, and 25-30% growth for other brands. All brands performed excellently, laying the foundation for annual performance growth. We maintain our profit forecast for 2024-2026, and expect net profit of 134.3/136.6/15.65 billion yuan. The corresponding EPS is 4.7/4.8/5.5 yuan. The current stock price corresponds to PE 15.6/15.3/13.4 times, maintaining a “buy” rating.
Anta: The 2024Q1 turnover reached expectations under a high base. E-commerce performance was outstanding. The operating indicators showed steady growth in 2024Q1. The 2024Q1 and 2023Q1 orders increased by about 20% per medium order, respectively, meeting expectations. By category, both Anta adults and Anta children saw an increase in orders; by channel, online was better than offline, and e-commerce channels grew 20-25% (negative growth under 2023Q1's high base and inventory removal), mainly due to popular positioning, professional breakthroughs, and brand improvement strategies, leading to outstanding performance in the basketball and running categories. Stable operating indicators: 2024Q1 inventory sales ratio <5, and discounts are steady. Among them, online discounts have improved significantly, driven by new products, achieving beautiful sales performance with lighter discounts.
FILA: Double growth in large goods, children's clothing and trendy brands were affected by the closure of stores in 2023. Under the high e-commerce base, sales volume increased by about 10% in 2024Q1 and 2023Q1, respectively. By category, it is expected that FILA Core will double growth, Fusion will decline slightly, and Kids will remain basically the same. The performance of Fusion and Kids is weak compared to Core, mainly due to the net closure of Fusion and Kids stores in 2023; in particular, Fusion closed more stores; points Looking at the channel, the live streaming channel performed brilliantly, 2
The 024Q1 e-commerce channel grew by nearly 25-30 percent (2023Q1 e-commerce grew ~ 40%). Inventory sales ratio: 2024Q1 has a significant month-on-month improvement, with a month-on-month improvement of 3 pct online and 1 pct offline improvement. It is expected that the top product/top channel/top brand strategy will continue to be firmly implemented in 2024. FILA products are expected to continue to increase the proportion of footwear products and professional sports series. At the same time, new ICONA stores will be launched on top channels. Currently, there are 2 ICONA products and a high focus on high-end sports segments, including fitness, golf, tennis and outdoor, etc., as well as a number of joint series and limited global supply series.
Other brands: Outdoor performance continues to be impressive. Descente's growth is 20-25%, and Kolon's growth is close to 50%. 2024Q1 turnover increased by 25-30%. By brand, Descente recorded a 20-25% increase, and Kolon grew by 50%.
2024Q1 Descente lays out high-end outdoor functional sports children's clothing, and opened its first store at Nanjing Deji Plaza for children aged 7 to 14. The product line includes application scenarios such as skiing, golf, and triathlon. The Kolon brand is uniquely positioned and is expected to further increase the share of spring and summer products and open up channels in the southern market.
Risk warning: Consumer confidence recovery falls short of expectations, product upgrades and channel optimization fall short of expectations.