On the evening of June 25, Guochao brand Li Ning Co. Ltd. released a beautiful performance report. Li Ning Co. Ltd. expects a net profit of no less than 1.8 billion yuan (RMB, the same below) in the first half of this year, compared with 683 million yuan in the same period last year. Anta had expected the company's first-half net profit to grow by more than 65%, or about 2.38 billion yuan, without taking into account the influence of the Amer joint venture.

Li Ning Co. Ltd., Xtep, Anta and other domestic sports brands, it is to catch up with the national trend, coruscate a new machine. Taking advantage of the "national trend" and tearing off the label of "local flavor", these sports brands have become more and more popular among young people, and their sales have soared all the way.

In the secondary market, domestic sports brands are enthusiastically sought after by capital, and their stock prices repeatedly refresh record highs, easily crushing the A-share "Mao Wu". Since March, ANTA Sports Products has risen 52%, Li Ning Co. Ltd. 90%, and Xtep International has soared 264%, with the latest market capitalization of HK $486.3 billion, HK $206 billion and HK $34.9 billion respectively.

Since the start of this upward trend on March 20, 2020, Xtep International has risen 563%, Li Ning Co. Ltd. 391%, Antai Sports 297%, and the market capitalization has increased by 29.5 billion Hong Kong dollars, 164.3 billion Hong Kong dollars and 362.6 billion Hong Kong dollars respectively, a total increase of 556.4 billion Hong Kong dollars (about 462.5 billion yuan).

The performance of domestic brands has soared! Li Ning Co. Ltd. 's net profit in the first half of the year is not less than 1.8 billion yuan

The national trend is getting fiercer and fiercer, and the performance of domestic sports brands is also soaring.

On the evening of June 25, Li Ning Co. Ltd. issued a performance notice on the Hong Kong Stock Exchange, expecting a net profit of not less than 1.8 billion yuan in the first half of this year, compared with 683 million yuan in the same period last year. This means that Li Ning Co. Ltd. 's performance growth in the first half of the year will exceed 163 per cent. Li Ning Co. Ltd. said the improvement in the group's performance was mainly due to revenue growth of more than 60 per cent and continued improvement in operating profit margins.

According to the annual report disclosed in March this year, Li Ning Co. Ltd. 's operating income in 2020 was 14.457 billion yuan, an increase of about 4.2 percent over the same period last year. On a comparative basis, net profit was 1.698 billion yuan, an increase of 34.2 percent over the same period last year. E-commerce channel has become a new growth point for Li Ning Co. Ltd., and the proportion of income is gradually increasing. In 2020, Li Ning Co. Ltd. 's proportion of e-commerce channel sales has increased to 28%.

ANTA Sports Products's performance is also growing rapidly. ANTA Sports Products issued a forecast for the first half of 2021 on the Hong Kong Stock Exchange on June 17, saying that without taking into account the influence of Amer, the company's first-half net profit will increase by no less than 65%, to about 2.38 billion yuan. Anta said that in mid-2020, the impact of the epidemic on Chinese mainland retail market has been relatively significantly reduced, Anta brand, FILA brand and other brand revenue recorded a strong rebound compared with mid-2020.

It is worth noting that according to the previously disclosed annual report, Anta's net profit in 2020 was 5.162 billion yuan, exceeding Adidas's net profit of 429 million euros (about 3.315 billion yuan). This is also the first time that Anta's net profit has surpassed that of Adidas.

So far, Hong Kong stock Xtep International has not disclosed the results forecast for the first half of this year, but the previously disclosed first-quarter operating data are also quite eye-catching. In the first quarter, retail sales of Xtep International's main brand Xtep increased by about 55% compared with the same period last year (including online and offline channels). The retail discount level is from 30% to 25% discount, and the retail inventory turnover is about four and a half months. Compared with the same period last year, the business performance of Xtep brand has improved significantly in the first quarter of this year.

Share prices skyrocketed, and well-known investment banks Hillhouse entered the game.

More eye-catching than the sales performance is the share price performance of the above-mentioned domestic sports brands. Since last year, the Hong Kong shares of these companies have been enthusiastically sought after by the capital market, and the share price performance has easily crushed the "Mao Wu" of A-shares.

Especially since March this year, the share prices of ANTA Sports Products, Xtep International and Li Ning Co. Ltd. have accelerated and repeatedly set new highs. Since March, ANTA Sports Products has risen 52%, Li Ning Co. Ltd. 90%, and Xtep International has soared 264%, with the latest market capitalization of HK $486.3 billion, HK $206 billion and HK $34.9 billion respectively.

In fact, since the start of this rally on March 20, 2020, Xtep International has risen by 563%, Li Ning Co. Ltd. by 391%, and Antai Sports by 297%, with a market capitalization of HK $29.5 billion, HK $164.3 billion and HK $362.6 billion respectively.

It is worth noting that the recent accelerated rise in Xtep's international share price is related to the entry of Hillhouse, a well-known investment bank.

Xtep International issued an announcement on the Hong Kong Stock Exchange on June 15, Hillhouse subscribed for HK $500m convertible bonds of Xtep International. At the same time, subscribe for Xtep subsidiary Xtep Global Investment (with the management and ownership rights of Gesway and Paladin) US $65 million (about HK $506 million) convertible bonds, and establish a strategic partnership. Hillhouse invested a total of about HK $1 billion in Xtep International and its subsidiaries.

In 2020, Xtep International's annual revenue was 8.172 billion yuan, down 0.1 per cent from a year earlier. However, the annual revenue of the fashion sports series, represented by Galaxy and Paladin, was nearly 1 billion yuan in 2020, a year-on-year increase of 114.4%. The fashion and sports sector represented by Galaxy and Paladin accounted for 12.2 per cent of Xtep's annual income, compared with 5.7 per cent in 2019.

Anxin International believes that Xtep International is rich in cash, so the most important thing for Hillhouse for the company is not financial support, but the help of channel resources and industry experience. Tianfeng Securities believes that the introduction of Hillhouse Group will enhance the competitiveness and profitability of the two brands, and look forward to fully releasing the potential of the two brands in China's fast-growing sportswear market.

On the day Hillhouse got its entry, Xtep international shares opened nearly 15 per cent higher, rising more than 30 per cent at one point, a record high, and closing up 20.72 per cent as of the day. In the following days, Xtep International share price continued to soar, setting an all-time high for many days in a row. Xtep International has risen nearly 50 per cent since June 15.

The organization is optimistic about high-quality domestic brand clothing enterprises.

A new era of "national tide" is coming.

According to the "2021 Guochao search big data report" jointly released by Baidu, Inc. and the people's Daily Research Institute, the attention of Guochao has increased by 528% in the past decade, and the attention of domestic brands has reached three times that of foreign brands in 2021. As for the content related to the national tide, 74.4% of the followers came from post-90s and post-00s. Li Jiaqi, a well-known e-commerce anchor, sighed: "A group of young people of Generation Z who will buy, coupled with new and good enterprises, have created a new trend and new domestic products." "

Domestic brands account for seven of the top 10 consumer brand search hotspots, and Guochao products were pushed to C position for the first time during the 618 promotion period, according to data disclosed by an e-commerce platform.

In May this year, Baidu, Inc. and the people's Daily online Research Institute jointly released the "Baidu, Inc. National Tide Pride search big data" report, which shows that the popularity of the national tide has increased by 528% in the past decade, and now the national tide has entered the 3.0 era. The national tide in the new era is not limited to new domestic products, but also includes the all-round rise of Chinese power behind culture, science and technology and other fields.

Data show that the attention of domestic brands is three times that of foreign brands in 2021. In the content related to Guochao, 74.4% of the followers came from post-90s and post-00s.

According to the Sino-Thai Securities Research report, looking back on 618 this year, national brand enthusiasm was high, among which domestic sports brands Li Ning Co. Ltd., Di Sant, Fila, Anta and Xtep increased by 164%, 150%, 69%, 59% and 41% respectively compared with the same period last year, while overseas brands Adidas, Nike and Puma fell 32%, 26% and 14% respectively compared with the same period last year.

On e-commerce platform JD.com, from June 1 to June 18, the turnover of sports domestic brands increased by more than 100% compared with the same period last year, while the turnover of emerging domestic brands increased four times year-on-year. Anta, Li Ning Co. Ltd., Peak, Jordan and 361° are among the top five most popular sports brands.

Guoxin Securities pointed out that most key companies showed obvious competitive advantages in the peak consumption season of 618, and the growth of local head sports brands was particularly bright under the enthusiasm of domestic products. Brands that are optimistic about the accelerated growth of fundamentals in the short term deliver brilliant medium-term results, and continue to be optimistic about high-quality enterprises with leading brand strength, product strength, operating efficiency and health in the long run. The brand focuses on recommending ANTA Sports Products, Li Ning Co. Ltd., Xtep International, Bosideng International, Samar clothing, sound medical care, upstream and downstream sports track quality leaders Shenzhou International Group, Topsports International Holdings Limited.

Haitong International also suggested paying attention to high-quality domestic brand clothing enterprises, believing that the recovery of clothing retail benefited from: 1) the effective and stable control of the epidemic situation, and 2) the Xinjiang cotton incident accelerated the harvest and recognition of high-quality domestic brands. It is believed that the Xinjiang cotton incident diverts some consumers' demand for buying overseas brands in the short term, and encourages consumers to include domestic brands in the same consumption consideration in the long run. To enhance consumers' sense of national confidence through wearing domestic brands, while high-quality domestic sports enterprises will fully benefit from this trend.