CICC Maintains Outperform Rating on ANTA SPORTS (02020), Target Price HK$110.91

Stock News01-28

CICC has released a research report maintaining its 2025 EPS forecast for ANTA SPORTS (02020) at RMB 4.71, with 2026/2027 EPS forecasts of RMB 4.76/RMB 5.04. This implies a forward 2026/2027 P/E ratio of 14x/13x. The firm reiterates its 'Outperform' rating. Considering the company's prominent multi-brand global value, CICC maintains its target price of HK$110.91, corresponding to 2026/2027 P/E ratios of 21x/19x and representing a 45% upside potential. The main points from CICC are as follows:

The company recently announced the acquisition of a 29.06% stake in Puma SE for EUR 35 per ordinary share, totaling approximately EUR 1.506 billion (excluding tax, roughly RMB 12.278 billion). This transaction will be fully funded by ANTA SPORTS's own cash reserves. Upon completion, ANTA SPORTS will become the largest shareholder of Puma by acquiring a significant strategic minority stake.

Considering the brand's long-term value, the report deems the acquisition price reasonable. Puma's 2024 revenue/net profit/total assets were EUR 8.82/0.34/7.14 billion, while its 1H25 figures were EUR 4.02/-0.25/7.06 billion, respectively. ANTA SPORTS indicated the acquisition price represents 0.8x enterprise value to expected 2027 revenue. CICC believes the price is relatively reasonable when considering the brand's long-term value.

Puma is an internationally leading sports brand with high multi-dimensional complementarity to ANTA SPORTS. With a history spanning over 70 years, Puma boasts significant advantages in football, running, motorsports, basketball, and general training, supported by a rich historical product database. It holds extensive global influence in both professional and lifestyle sports segments, with a strong foundation in Europe, Latin America, Africa, and India; currently, China contributes a relatively low portion to Puma's revenue. The report suggests Puma can enrich ANTA SPORTS's brand portfolio and achieve high complementarity with its other brands across product lines and regions, potentially further enhancing ANTA SPORTS's overall international competitiveness.

ANTA SPORTS's focused, multi-brand, global strategy advances further, potentially reactivating Puma's brand value. Previously, ANTA SPORTS successfully developed FILA, Descente, and Kolon into reputable, well-known brands in China and accelerated the global expansion of brands under Amer Sports in the worldwide sporting goods market. The report contends that ANTA SPORTS has established a brand-building, retail, and supply chain system capable of supporting global growth, accumulating market-proven success experience. ANTA SPORTS announced it will seek to appoint representatives to Puma's Supervisory Board post-transaction to support Puma's management in driving its plans and help reactivate Puma's brand value.

Risk warnings include potential delays in finalizing the transaction, weaker-than-expected retail environment, and intensifying industry competition.

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