24Q3 turnover: Main brands are stable, FILA has declined slightly, and other brands have accelerated month-on-month. The number of units of the main 24Q3 brand was growing year over year, and the growth rate was steady (24H1: number of growing units). FILA decreased the number of units year-on-year (24H1: increase in units). This is the first year-on-year decline in quarterly turnover after 22Q4, judging that offline trendy brands and children's businesses are under pressure. Other brands (Descente and Kolon) grew 45-50% year over year (23Q3:40-45%, 24H1:35-40%), and quarterly turnover has accelerated quarterly since 24Q1, and is expected to continue to benefit from the booming outdoor racetrack.

The main brand opened 300+ new stores on National Day. Anta lays out traditional markets, breaking the situation of a thousand stores in the past, opening multiple new store types in key cities, increasing coverage and satisfying consumer segments. In addition to different images, each store type provides specially customized products to provide a unique consumer experience. During the National Day, the Anta brand opened 300+ new stores nationwide (accounting for 4.2% of the number of stores at the end of 24H1), covering most major provinces and cities, including four types of stores:

Anta Olympic Hall of Fame Store, Anta Portfolio, Anta Champion, Super Anta. We predict that the new store type will improve the efficiency of larger stores. Combined with increased store efficiency, the main brand will help the main brand grow in Q4.

Diversified new store types target market segments. With the theme of the Olympics, the Anta Olympic Hall of Fame offers spectacular enjoyment; Anta's portfolio focuses on sneakers, divided into black label and white label stores. The white label store is a simple art style, and the black label store is a futuristic and cool style; the Anta Champion store focuses on professional outdoor sports, using an advanced and simple design style to provide an advanced experience in sports life; the Super Anta Store targets the mass market and is positioned as a diverse and cost-effective sports store, with red as the main color and visual impact.

The HK$10 billion repurchase plan is expected to increase returns and stabilize stock prices. The company announced that shares of no more than HK$10 billion will be repurchased within 18 months from August 27, accounting for 3.9% of the market value (at the closing price on October 14). The purpose of the repurchase plan is to promote shareholders' interests and increase the company's medium- to long-term capital. As of October 14, the company had repurchased and cancelled 3.397 million shares, accounting for 0.12% of the issued shares. The average repurchase price was HK$74.996, for a total of HK$0.25 billion.

Profit forecasting and valuation. We believe that as a leading multi-brand sporting goods group, Anta's competitive barriers are mainly due to ① scarce high-quality multi-brand assets, occupying multiple tracks with high growth potential, and ② a mature and strong operating system to build resilience to economic cycles. We continue to be optimistic about the growth potential of many brands. We expect the company's 2024/2025 net profit to be 13.765/13.993 billion yuan, giving the 2024 PE valuation range 18-20X, corresponding to a reasonable value range of 93.69-104.11 HKD/share according to the exchange rate of HKD1 = 0.92 yuan, maintaining a “superior to the market” rating. Risk warning. The retail environment is weak, new brand acquisitions and integration are falling short of expectations, and the store expansion process is slowing down.