According to the WeChat account of the National Climate Center, China's average temperature in 2024 was 10.9℃, 1.01℃ higher than year-round (9.89℃), surpassing 10.71℃ in 2023, and another record high. We expect abnormal temperatures in the winter of '24, combined with the high base figure caused by the late Spring Festival in '24, which will have a certain impact on the company's peak season sales; on the other hand, the company's brand potential is strong, and growth resilience is still strong. Combining the above factors, we expect the company's branded down jacket business to achieve steady growth of close to 10% in FY25.

In-depth cooperation with Harbin to strengthen the Northeast market. On November 9, 2024, as Bosideng's first urban co-branded product, the “Erbin x Bosideng” series of down jackets were launched one after another in Bosideng stores nationwide. Since then, Bosideng and Harbin have continued to deepen their strategic cooperation. With the theme of “Wearing Bosideng to Warmly Visit Erbin”, visitors from all over the world have been invited to “date the ice, snow, and warm the world” this winter. It has also helped the company's brand expand its channels and increase its potential in the Northeast region from one side.

In December 2024, Bosideng grandly opened its next-generation Dengfeng concept store in Beijing's fashion landmark Sanlitun, further enhancing the brand's potential. With the theme of “See You at the Summit”, the opening event represents Bosideng's vision of exploring the unknown and challenging the limits with consumers.

Recently, Chairman Gao Dekang said in an exclusive interview with a Beijing News reporter that in the future, the company will continue to promote digital innovation represented by the industrial Internet, big data, artificial intelligence, etc., and apply it to the entire business management process.

In 2024, the company's first product, the Bosideng single-shell jacket, was intelligently designed and implemented by AI. The response was overwhelming after it was introduced to the market. Artificial intelligence technology has greatly improved design efficiency, reducing development time from 100 days to 27 days.

Active buybacks demonstrate management's firm confidence. The company has been actively repurchasing since the beginning of 2025. Since January 15, it has repurchased a total of 56.21 million shares, accounting for 0.5% of the total share capital, and the cumulative repurchase amount is HK$0.209 billion.

Based on factors such as FY25 weather conditions and Spring Festival dates, we slightly adjusted our profit forecast for FY25-27 (revenue was lowered and fee rates increased) to forecast FY25-27 earnings per share of 0.30, 0.35, and 0.40 yuan (original 0.32, 0.37, and 0.43 yuan), respectively. Referring to comparable companies, we gave FY26 a PE valuation 14 times, corresponding to the target price of HK$5.26 (1 RMB = HK$1.07) to maintain a “buy” rating.

Risk warning: economic slowdown, weather fluctuations, women's clothing business continues to fall short of expectations, etc.