01368 Overview

Stock Performance Overview: Various Hong Kong stocks showed mixed performance, with notable gains for ANTA SPORTS (+2.365%) and HAIDILAO (+5.822%), while LI NING (-1.875%) and SANDS CHINA LTD (-1.271%) experienced declines.

Short Selling Data: Short selling activity varied across stocks, with LI NING having the highest ratio at 23.224%, while TSINGTAO BREW reported the lowest at 1.075%.

Investment Ratings: Most stocks listed received a "Buy" rating, except for LI NING, which is rated as "Hold," indicating a generally positive outlook for the majority of the stocks.

Market Insights: Citi's estimate for Macau's February gross gaming revenue (GGR) is projected at MOP20 billion, reflecting a 1% year-over-year increase, suggesting a stable gaming market.

Bond Repurchase and Issuance: XTEP INT'L announced a proposal to repurchase HKD500 million of its 1.5% convertible bonds due in 2026 and issue HKD500 million in zero-coupon convertible bonds due in 2029.

Conversion Details: The outstanding 2025 convertible bonds can be converted into approximately 83.1947 million shares at an adjusted conversion price of HKD6.01, while the new bonds have an initial conversion price of HKD6.37, allowing conversion into about 78.4929 million new shares.

Commitments from Bondholders: The company has received commitments from bondholders to sell the entire HKD500 million of the 2025 convertible bonds, indicating strong support for the repurchase.

Use of Proceeds: The net proceeds of around HKD492 million from the new bond issuance are intended for refinancing the outstanding 2025 convertible bonds.

Company Performance: XTEP International reported solid 4Q25 results, with its main brand's retail sell-through remaining flat year-on-year and retail discounts between 25-30%. The Saucony brand, however, saw over 30% growth in retail sell-through year-on-year.

Inventory and Forecasts: As of December, the channel inventory turnover was 4.5 months. CICC maintained its EPS forecasts for 2025 and 2026 at RMB0.49 and RMB0.55, respectively, and introduced a new forecast of RMB0.61 for 2027.

Stock Rating and Target Price: CICC kept its rating for XTEP at Outperform, with the current share price reflecting a projected 2026 PE ratio of 8x. However, due to a downward shift in industry valuations, the target price was reduced by 11% to $6.47, corresponding to an estimated 2026 PE ratio of 11x.

Market Activity: The stock experienced short selling of $11.05 million, with a short selling ratio of 14.392%. Additionally, JPMorgan maintained an Underweight rating on LI NING, indicating ongoing challenges in the market.

LI NING's Recovery Efforts: JPMorgan recognizes LI NING's management efforts to revitalize the brand, although the company is expected to face a low earnings base with declines projected from 2023 to 2025.

Earnings Forecast: A modest earnings increase of only 2% is anticipated for LI NING in 2026, which is significantly lower than the expected over 10% increase for competitors ANTA SPORTS and XTEP INT'L.

Broker Ratings: UOB Kay Hian has maintained a Hold rating on LI NING, raising its target price to HKD 20.2, while keeping the target price at HKD 14.6 and an Underweight rating.

Short Selling Data: As of January 19, 2026, LI NING has a short selling ratio of 21.243% with $128.12M short sold, compared to lower ratios for ANTA SPORTS and XTEP INT'L.

Stock Performance Overview: Several companies, including Samsonite and Anta Sports, showed mixed stock performance with varying short selling ratios, indicating market sentiment and trading activity.

Recommendations and Target Prices: Analysts have given "Outperform" ratings to multiple companies, including Pop Mart and Shenzhou International, with target price adjustments reflecting expected performance changes.

Short Selling Insights: Notable short selling activity was observed in companies like Pop Mart and Li Ning, with ratios indicating significant market speculation against these stocks.

Related News Highlights: Chow Tai Fook reported a slight increase in interim net profit and raised its full-year profit margin guidance, reflecting positive management outlook amidst market fluctuations.

Implementation Plan for Consumer Goods: Six Chinese ministries have launched a plan to enhance the alignment of supply and demand in consumer goods, aiming to boost consumption amid pressures from insufficient purchasing power.

Government Subsidies: The Chinese government is allocating significant funds for trade-ins of old consumer goods, with RMB150 billion in 2024 and RMB300 billion in 2025, to stimulate short-term demand through national subsidies.

Retail Sales Growth: In October 2025, total retail sales of consumer goods increased by 2.9% year-on-year, although the growth rate showed a slight decline compared to the previous month, indicating ongoing challenges in the consumer market.

Stock Recommendations: China Galaxy Securities has recommended various stocks across sectors, including GUMING and DAMAI ENT in social services, ANTA SPORTS and XTEP INT'L in apparel, and TCL ELECTRONICS in technology, reflecting a focus on the new consumer track.