YUE YUEN IND (00551) surged more than 3%, reaching HK$16.69 with a turnover of HK$63.76 million by the time of writing. Shanxi Securities noted in a research report that international sportswear brands have released their Q3 earnings, with On Running and Asics leading in growth, while Adidas and Deckers delivered stable performance. Puma, VF, and Under Armour continued to underperform. The brokerage highlighted that textile manufacturers currently demonstrate relatively strong earnings stability, with core client Nike expected to stabilize operations and high customer concentration across companies.
Zheshang Securities pointed out that YUE YUEN IND's manufacturing shipments declined in Q3 due to a high base effect, but efficiency improvements and higher average selling prices (ASP) led to better-than-expected margin recovery. Retail revenue declines also narrowed sequentially, signaling potential stabilization.
UBS cited YUE YUEN IND's management, stating that Q3 OEM margins improved compared to H1, driven by reduced overtime, increased worker familiarity with orders, and stabilized U.S. tariff policies. Some orders were reportedly pulled forward into Q4. The bank expects YUE YUEN IND's Q4 sales volume to decline year-on-year but forecasts higher ASP. Looking ahead to next year, UBS anticipates potential benefits from select brand recoveries. Strong holiday sales could further boost brand confidence, benefiting the company's sales and attracting new brand clients.
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