Samsonite's 3Q24 revenue may have a low year-on-year decline under the fixed exchange rate. Samsonite plans to announce 3Q24 results in 4Q24. We provide 3Q24 performance trends based on recent trends and channel research.

Key points of interest

1. The company's overall revenue in 3Q24 may be lower by the fixed exchange rate (1.6% year-on-year increase in 2Q24). The regional growth ranking may be Asia

2. Profit margins may be under pressure, mainly due to the drag on performance in Asia and TUMI. 3. We don't think the price war in the Indian market will continue. 0.4 and 0.2 billion dollar share repurchases: Basically, they are being bought back one after another every day. As of September, the company has repurchased 70 million US dollars, and we expect to complete the full share repurchase target by the end of 2024. 5. Secondary listing in the US: The schedule has not yet been confirmed. We believe that the repurchased shares may be used for the second listing and sale. At the same time, it is not ruled out that additional new shares will be issued. We need to observe market subscription requirements. 6. 2024 dividend plan: The company has not yet decided, and we think it may be disclosed when the annual report is released in March next year according to convention. See main text for details.

Profit forecasting and valuation

We generally maintain our revenue and net profit forecasts for 2024 and 2025. We maintain our outperforming industry rating and target price of HK$28 (based on 13 times 2024 price-earnings ratio, corresponding to 12 times 2025 price-earnings ratio). The current stock price corresponds to 8.8 times and 8.1 times the 2024 and 2025 price-earnings ratios, and our target price provides 44% upside.

risks

Macro adverse factors; asset impairment losses; more intense external competition, competition among internal brands; foreign exchange rate risk; possibility of secondary listing.