Text | Zheng Xian
I Can Play.
Peak Sports, which owns this classic Slogan, rejoined the sports brand team after missing the development opportunity of the "national tide wind". It's trying to tell the public — "I can still fight."
Peak Sports recently announced that it has received a strategic investment of 1.5 billion yuan from the "national team" capital. Investors include China Resources State Adjustment Xiamen Consumer Fund, Jianxin Trust and its subsidiary Jianxin (Beijing). It is reported that the company is still in contact with a number of investment institutions, and it is expected that a new round of financing will be opened soon. It is also reported that after delisting from the Hong Kong Stock Exchange in 2016, Peak is considering an IPO in A-shares next year. The company's latest valuation is 9 billion yuan.
This financing has once again brought back the veteran sports brand, which became famous 15 years ago for sponsoring Yao Ming's Houston Rockets. On October 11, the company released another message through the official micro: "Recently, Shanxi suffered a rare heavy precipitation disaster in history. Peak Sports decided to donate 10 million yuan of materials to Shanxi and will send them to the disaster area at the first time. ”
This naturally reminds the outside world of Hongxing Erke, who previously donated money for the Henan flood disaster and became popular overnight, and belongs to the "Jinjiang system".
In recent years, with the rise of sports brands, the Fujian sports shoes and apparel industry has also won the favor of many investment institutions. As a result, this old sports brand store, founded in Quanzhou, Fujian Province, in 1989, waited for an excellent opportunity to turn over.
<h1 class="pgc-h-arrow-right" data-track="8" > the driver of the pulling scooter landed in Hong Kong stocks</h1>
In the 1980s, Xu Jingnan, the founder of Peak, was still a poor boy in Quanzhou, "I started with a scooter." At that time, a scooter from the north gate to the south gate could earn two yuan, as long as you are willing to do it, dora a few trips can make a few more trips. To say that my first pot of gold, it was from that time. ”
Looking back on the past, Xu Jingnan feels that this hard-working experience is the most precious wealth of his life.
Since then, Xu Jingnan has opened a number of small enterprises such as machine brick factory and wooden box factory. These experiences have accumulated experience in running a business for him.
At that time, Nike invested in a shoe factory in Quanzhou, and a large number of small processing factories for clothing, shoes and hats sprang up in the local area. Xu Jingnan set his sights on sneakers, hoping to match the processing for Nike. However, just after Xu Jingnan completed the factory, Nike's Quanzhou factory was withdrawn. Xu Jingnan simply said, "One does not do, two do not stop, I want to create my own brand!" ”
Thus "Fontan" (the predecessor of Peak) came into being.
He used high salaries to introduce the technicians and workers left behind after Nike left, invested in the introduction of foreign production lines, and spent effort to establish a quality management mechanism.
For the long-term development of the brand, Xu Jingnan changed the name of "Fengdeng" to "Shandeng", and finally changed it to the English "PEAK" and transliteration of "Peak".
According to the enterprise investigation, Peak Group is mainly engaged in the design, development, manufacture, distribution and promotion of "PEAK Peak" brand sports products, including sports footwear, clothing and accessories. Xu Jingnan is the chairman and general manager of the company.
In fact, since its birth, Peak has taken the development of basketball series products as a strategic positioning and proposed the strategic goal of building "China's first basketball brand".
Basketball shoes are the entry point for Peak's fame. In 1991, Peak began to sponsor the Bayi men's basketball team and developed the first pair of plus-size basketball shoes for the "Bayi Team".
"At that time, we produced basketball shoes, and no enterprise in China had the ability to produce them." Xu Jingnan recalled.
Before the 1990s, Chinese basketball teams did not have real basketball shoes, and athletes wore rubber-soled cloth shoes. In 1991, due to the sponsorship of the Bayi team, Peak's reputation was greatly enhanced, and there was almost no opponent. Pickle shoes have also become a sought-after commodity. "South Peak, North Double Star" is a good story.
In the marriage of Peak and basketball, the NBA is undoubtedly a Colorful movement. Since Yao Ming joined the NBA in 2002, the Houston Rockets have become the "favorite" of Chinese fans. Xu Jingnan keenly grasped this business opportunity.
On December 22, 2005, Chinese audiences noticed that a billboard with the bright red Peak logo appeared prominently in basketball at the Toyota Center in Houston.
Peak landed in the NBA, causing strong repercussions at home and abroad. The local Chinese-language media used the term "epoch-making" in their reports.
Peak, which tasted the sweetness, accelerated brand promotion in the international market. Following the Rockets, Peak has signed a number of NBA teams such as bucks and Spurs, created exclusive boots for Battier, Parker and other stars, became the official market partner of the NBA, and established a "brand promotion three-dimensional strategy" supported by NBA home sponsorship, signing NBA star endorsements, working with NBA leagues, sponsoring overseas top sports events and sports organizations, setting up overseas agencies, and simultaneous expansion of online stores.
The association with basketball has made the road to the internationalization of the Peak brand wider and wider. Later, with the help of the east wind of the 2008 Beijing Olympic Games, Peak jumped into the Hong Kong capital market a year later, becoming the sixth domestic sports shoe and apparel manufacturer to land on the Hong Kong capital market after China Trend, Li Ning, ANTA, Xtep and 361 Degrees.
On 29 September 2009, Peak fell below its issue price of HK$4.1 on the first day of listing in Hong Kong. In the years leading up to delisting in 2016, Peak Sports' share price was well below the issue price, hovering between HK$1-3.
And, since 2011, Peak's net profit has declined for three consecutive years. This is because in the first half of 2012, the inventory of the above six major sports brands in China was high, with a total inventory of 3.721 billion yuan. In order to absorb high inventory, sports brand companies can only set off a wave of discounts everywhere and continue to close stores. In 2012 alone, Peak closed more than 1,000 stores nationwide.
From 2011 to 2015, Peak's performance declined significantly. The five-year revenue was 4.655 billion yuan, 2.910 billion yuan, 2.615 billion yuan, 2.842 billion yuan and 3.109 billion yuan, and the net profit was 778 million yuan, 311 million yuan, 244 million yuan, 321 million yuan and 392 million yuan, respectively. In the first half of 2016, Peak Sports's revenue was 1.298 billion yuan, down 5.96% year-on-year; net profit attributable to the mother was 169 million yuan, down 3.73% year-on-year; and gross profit fell 5.6% year-on-year to 494 million yuan.
<h1 class="pgc-h-arrow-right" data-track="29" > technology developed into a moat</h1>
This is where the company's transformation begins.
In November 2016, Peak completed privatization and delisted from Hong Kong stocks. In March 2017, Peak Sports held the "Return to A-share Development Forum" to prepare for the listing plan. Xu Jingnan explained the delisting at the forum: "One of the most important goals of Peak is to create a sports brand that Chinese, to be a century-old enterprise and create an international brand, and this goal has been set in 1991. We found it difficult for Hong Kong's capital market to create benefits for our international brands, so we decided to return to A-shares. ”
Some analysts pointed out that "in fact, the stock price performance of Peak after its listing in Hong Kong is not satisfactory, but in stark contrast, after the state issued a document on accelerating the development of the sports industry, the sports industry ushered in a golden age, and domestic sports concept stocks and even pan-sports concept stocks were greatly welcomed by investors." In the sports industry for many years, the investment value has been underestimated for a long time, and it is difficult for the company to effectively use the capital platform, which in turn affects the company's business development. Therefore, it is imperative for Peak to implement privatization and return to A-shares. ”
In the view of Zhang Qing, founder of Beijing Key Way Sports Consulting, this is the only way for Peak, "It is undervalued in the Hong Kong stock market and has limited financing." Delisted in Hong Kong and listed on the mainland, I think not only Peak, but also many Chinese companies are considering this option. Zhang Qing told Caijing Wujie.
In order to further expand its domestic business, after 2018, Peak acquired the casual clothing brand King and the children's clothing brand Dida. At the same time, Peak officially released the youth sports brand PEAK KIDS, focusing on the youth sports life market.
Compared with other domestic sports brands, Peak's brand moat is technology and research and development. Peak brand director Lin Xiaoxiong said that the company currently has 5 major innovation and research and development centers in Los Angeles, Beijing, Xiamen, Quanzhou and Xi'an, which can not only obtain the top sports technology that keeps up with the most international trends in the world, but also launched a new material innovation research center for the brand, and the company is also customizing high-end products such as 3D printing technology.
In December 2018, Peak released State Pole 1.0, and half a year later, State Pole 1.0 PLUS was launched. The Purpose of the Xi'an R&D Center established in 2019 is to develop extremely related products and gradually launch a series of products such as upgraded running shoes.
Peak's official website introduced: "Since the launch of 2019, the state pole 1.0 PLUS, the state pole flash series basketball shoes, the state pole slippers, the state pole hole shoes and other scientific and technological products, has long been high in the list of major categories of single products. Up to now, the cumulative sales volume of Peak State Pole series products has exceeded 15 million pairs. Its single explosive peak slippers series sells nearly 2 million pairs a year, ranking first in e-commerce sales for many consecutive months. ”
The big sale of the State Pole series also strengthens Peak's confidence in using the power of science and technology to build the brand into a sports tide brand.
"Peak hopes to build its own technology moat with its own unique technology products, form differentiated competition in the market, and form a competitive advantage." In the future, we will launch more best-selling products that integrate technology + trend. Xu Zhihua, CEO of Peak Sports, said that the positioning of the Peak brand is "new domestic product of science and technology", and is committed to walking out of its own unique development path through scientific and technological innovation.
Chen Quan, co-general manager of Jianxin (Beijing) Investment, who participated in this round of financing, also said that as one of the first batch of independent brands in China, Peak has a deep foundation of brand recognition, and has successfully crossed the industry cycle through the "renewal" of science and technology, showing the strong resilience and innovation ability of the management and the company.
<h1 class="pgc-h-arrow-right" data-track="41" > resolve market share heart disease through listing</h1>
With the rise of the national tide, consumers have rekindled their love for domestic sports brands. In the first half of this year, ANTA's revenue of 22.8 billion yuan, Li Ning's revenue reached 10.197 billion yuan, and sales of Xtep and 361 degrees also increased. Even the slightly niche noble bird and Hongxing Erke have also suffered "wild consumption".
This dividend also affected the domestic sports brand Peak.
Mr. Wang Xin, general manager of China Resources State Adjustment Xiamen Consumer Fund, who led the strategic investment, said that state-owned capital to help the development of domestic product brands is a win-win move for both sides. The fund hopes that through this investment and post-investment empowerment of Peak, the competitiveness of national high-quality enterprises will be enhanced, and domestic brands will achieve "me-based" under the pattern of double circulation, go global, and promote the influence of domestic brands in the domestic and international markets.
The rise of the national tide has also prompted Peak to begin to shift its main target users from the professional field to the general public.
Although Peak's lineup of signed stars still has big names like Andrew Wiggins, the market appeal of NBA stars has weakened as the NBA has cooled down in the Chinese market in recent years. On the contrary, on September 1 this year, Peak signed a young actor Wu Lei, which made the outside world shine and feel that the transformation of the former is accelerating - the target users have targeted Generation Z, trying to increase market share.
This is also the anxiety of Peak: in the list of market share of sports brands in 2020, Nike topped the list with 25.6% data, Adidas followed by 17.4%, domestic brand ANTA ranked third with a market share of 15.4%, li ning, Xtep and 361 degrees were 6.7%, 4.7% and 2.6%, respectively. Peak didn't make it.
In the view of some market participants, the retail market size of China's sportswear industry in 2025 is expected to exceed 600 billion yuan, and the future market space is huge. As Peak Sports regains the favor of capital, the pace of listing has accelerated after financing, and the determination to catch up with industry leaders has risen.
Zhang Qing, a senior sports consulting expert, is also optimistic about Peak's performance once it returns to A shares, "This is a reasonable choice." With the in-depth implementation of the national strategy of national fitness, including the implementation of the double reduction policy, the domestic demand market, consumption upgrading and a series of backgrounds, sports concept stocks in the mainland capital market can be described as a difficult to find. If Peak can successfully land in the mainland market, with its current good performance and huge imagination space in the sports industry, I believe it will have a satisfactory performance in the capital market. Zhang Qing then added, "Of course, the future of Peak still depends on hard power, but also depends on the company's own efforts." ”
Some media once asked Xu Jingnan how to become the first person in the world's basketball equipment from a coachman? Xu Jingnan replied with only one word: "Do."
This fits perfectly with I Can Play.