运动服装渠道观察：需求仍面临压力
John Chou * | Equity Analyst852 3743 8792 | john.chou@jefferies.comBoya Zhen * | Equity Analyst852 3743 8774 | bzhen@jefferies.comAnne Ling * | Equity Analyst852 3743 8783 | aling@jefferies.com Company Valuation/RisksANTA Sports Products LtdWe use DCF methodology as our primary approach to value Anta shares, as we expect investors to focus on its long-term value creation. In ourDCF model, we derive a WACC of 8.2%, with cost of equity of 9.5%, risk-free rate of 3.9%, equity risk premium of 5.6%, and beta of 1. We assumea perpetual growth rate of 1.0%, in line with our Hong Kong and China consumer sector at 0-2%. Our model factors in our estimated fair valueof Amer Sports.Downside risks include 1) new retail models fail to boost Fila's growth; 2) weaker-than-expected execution on Amer Sports leading to lower cashflow and profit; 3) larger-than-expected losses at Anta's newly acquired brands Descente, Kolon, Sprandi, and Kingkow; and 4) diluted managementresource to manage the transformation of multiple brands. Upside risks include 1) strong performance by new retail formats including the SuperAnta; 2) stronger market share gain by emerging urban outdoor brands, 3) stronger cost reduction and supplychain efficiency gains.Li Ning Co LtdWe value Li Ning using DCF methodology, as we expect investors to focus on the long-term growth profile. We assume a WACC of 9.50%, withcost of equity of 9.50%; risk-free rate of 3.9%, equity risk premium of 5.6%, and beta of 1.0. We assume a perpetual growth rate of 1.0%, in linewith our Hong Kong and China consumer sector at 0-2%.Downside risks: (1) execution: failure to deliver long-term margin guidance which could potentially trigger de-rating; (2) transitional volatility ingross margin: weaker-than-expected improvement in gross margin is the most significant downside risk to our thesis; this could stem fromdisappointing retail discounts for the retail business and/or lower sell-through contributions from new products; (3) weaker revenue growth,potentially driven by inventory shortage; and (4) weaker-than-expected improvement in store efficiency.Analyst Certification:I, John Chou, certify that all of the views expressed in this research report accurately reflect my personal views about the subject security(ies) and subjectcompany(ies). I also certify that no part of my compensation was, is, or will be, directly or indirectly, related to the specific recommendations or viewsexpressed in this research report.I, Boya Zhen, certify that all of the views expressed in this research report accurately reflect my personal views about the subject security(ies) and subjectcompany(ies). I also certify that no part of my compensation was, is, or will be, directly or indirectly, related to the specific recommendations or viewsexpressed in this research report.I, Anne Ling, certify that all of the views expressed in this research report accurately reflect my personal views about the subject security(ies) and subjectcompany(ies). I also certify that no part of my compensation was, is, or will be, directly or indirectly, related to the specific recommendations or viewsexpressed in this research report.Registration of non-US analysts:John Chou is employed by Jefferies Hong Kong Limited, a non-US affiliate of Jefferies LLC and is not registered/qualifiedas a research analyst with FINRA. This analyst(s) may not be an associated person of Jefferies LLC, a FINRA member firm, and therefore may not be subjectto the FINRA Rule 2241 and restrictions on communications with a subject company, public appearances and trading securities held by a research analyst.Registration of non-US analysts:Boya Zhen is employed by Jefferies Hong Kong Limited, a non-US affiliate of Jefferies LLC and is not registered/qualifiedas a research analyst with FINRA. This analyst(s) may not be an associated person of Jefferies LLC, a FINRA member firm, and therefore may not be subjectto the FINRA Rule 2241 and restrictions on communications with a subject company, public appearances and trading securities held by a research analyst.Registration of non-US analysts:Anne Ling is employed by Jefferies Hong Kong Limited, a non-US affiliate of Jefferies LLC and is not registered/qualifiedas a research analyst with FINRA. This analyst(s) may not be an associated person of Jefferies LLC, a FINRA member firm, and therefore may not be subjectto the FINRA Rule 2241 and restrictions on communications with a subject company, public appearances and trading securities held by a research analyst.As is the case with all Jefferies employees, the analyst(s) responsible for the coverage of the financial instruments discussed in this report receivescompensation based in part on the overall performance of the firm, including investment banking income. 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