News summary

Newsletter text

Daiwa raises Anta target price to HK$120

[Daiwa Capital raises Anta Sports 'share price target to HK$120 per sharemastercoinfreespin2021, reiterate the buy rating accordingly.]

recentlymastercoinfreespin2021After talks with Anta Sports management, Daiwa Capital raised its share price target from HK$110 to HK$120 based on confidence in the execution of the company's multi-brand strategy. Daiwa believes that with its multi-brand strategy, ANTA Sports can not only withstand short-term market fluctuations, but also ensure its long-term stable growth.

In order to better reflect the company's growth potential, Daiwa Capital revised its valuation basis and adjusted its forecast P/E ratio from 24 times this year to an average of 24 times this year and next. In addition, considering the company's overseas market expansion strategy, the bank slightly lowered its earnings per share forecast for 2025 - 2026 by 1% to show more cautious expectations for profit margins.

According to management, sales since April have remained strong compared with the first quarter, and online sales continue to grow faster than offline. Currently, the number of stores in Southeast Asian markets such as the Philippines, Malaysia and Vietnam is about 200, which has not contributed significantly to the company's revenue and profits. However, the company's management remains committed to promoting the retail revenue of Anta and other brands in overseas markets to reach the target of US$1.5 billion.

At the same time, the management maintains a high degree of attention to expansion opportunities in mature markets such as the Middle East, Africa, Europe and the United States, and actively seeks new business expansion opportunities.