The Zhitong Finance App learned that Anxin International released a research report stating that it maintains a 361 degree (01361) “buy” rating and predicts that the 2024/2025/2026 EPS will be 0.54/0.62/0.70, with a target price of HK$7. After the company was included in the Hong Kong Stock Connect last year, market attention was further increased, which also helped increase trading volume and liquidity. In the context of consumer stratification, consumers will pay more attention to the quality, functionality, and technology of products, and the company will continue to launch new products to seize more market share.

The report's main points are as follows:

Q1 turnover maintained rapid growth and started smoothly

Against the backdrop of consumers pursuing the ultimate in cost performance and product power, the company's overall performance in Q1 was good. The main brand turnover increased by double digits year on year, children's clothing increased 20-25% year on year, e-commerce increased 20-25% year on year, and children's clothing and e-commerce continued to grow well. The stock sales ratio was 4.5-5, which was basically the same from month to month. The retail discount was 30% off, which deepened slightly from month to month, but inventory and discounts were still at a healthy level. Furthermore, with the end of the 2024 Winter Order Fair, the company's orders are basically locked down for the whole year. It is expected that order performance will be strong and revenue growth is highly certain.

The product matrix continues to be rich, and the two categories of running+basketball drive growth

In December 2023, the company launched the CQT carbon critical running professional matrix (Feifun 3, Feiyao Future 1.5, Super Fly Float, Feifun 2ET, etc.), and in March of this year, it solemnly launched the Shippeng CQT running shoes (75% + propulsion) and the Shippeng Q Bomb Super 5.0 running shoes (60% rebound +). In addition to the running category, the company's newly signed NBA star Jokic's continuous launch of new products has further enriched the product matrix, thus covering a wider range of consumers.

Major sporting events help brands expand their influence

As the official partner of the fourth consecutive Asian Games, the 361 degree and Asian Games have formed a deep bond. Recently, the company has also officially announced that it has become an official partner of the Harbin Asian Winter Games. The company continues to sponsor large-scale events, increasing the brand's voice and helping the product's exposure rate and sales to a certain extent. Furthermore, the company continues to expand the sports market through its own events such as the “10KM Racing Series”, “Hit the Ground”, and “Women's Fitness Bureau”, etc., reaching out to sports participants in cities at all levels, and establishing a high-quality reputation for the brand. At the same time, the company launched innovative products through celebrity ambassadors, IP linkages, etc., to attract the attention of young consumers and continue to enrich the brand's youthful expression.

Risk warning: macroeconomic downturn, inventory backlog; industry competition intensifies; new product sales fall short of expectations.