Tianfeng Securities: Gave Li Ning (02331) a "buy" rating and is optimistic about the long-term development dividend of the sports national brand

Zhitong Finance APP was informed that Tianfeng Securities released a research report saying that Li Ning (02331) recently launched the 1990 classic standard series, raising the product tone and opening up the hanging price space; Channel restart expansion or will drive the scale of sustained growth, optimistic about the long-term development dividend of the sports national brand, it is expected that the net profit in 21-22 years will be 38/48/6 billion, PE is 44/35/28x, it is recommended to actively pay attention to and give a "buy" rating.

The main views of Tianfeng Securities are as follows:

The bank expects the October turnover to grow year-on-year or around the middle of 20%, of which

1) Douyin channels continue to shine brightly, the data shows that in Q2/Q3/October, the total sales of the two stores of Douyin Li Ning Flagship + Li Ning Sports Flagship were 0.9 billion/180 million/130 million, respectively, with a rapid increase in volume from the previous month, and 21Q3 accounted for about 10% of e-commerce, contributing to the net increase online;

2) The offline flow in October was disturbed by factors such as the high base number of the National Day double holiday last year and the temperature impact on the demand for dress-up, and it is expected to improve in November and December; At present, dealers have higher confidence in ordering next year, and it is expected that there may be positive performance in 2022.

3) In October, the performance of most sports brands at home and abroad slowed down, Li Ning's relative advantages are still obvious, and the brand strength and market share are still in the upward channel.

Overall, the bank is actively optimistic about Li Ning's follow-up development potential:

On the brand side, it launched Li Ning's 1990 classic standard high-end sports and leisure product line, raised the brand tone rich product series, formed a differentiated multi-dimensional coverage matrix with China Li Ning, Li Ning goods and Li Ning children, and used the classic LOGO and trend elements to focus on the post-85 high-end market;

On the product side, the core sports technology such as 䨻 is implanted into the mid-range mass product line (Liejun/Red Rabbit running shoe series and basket feather child, etc.), with the help of mature professional technology platform to enhance the price of hanging tags, while fabric technology with women's products have been launched, it is expected that the future functionality will account for 40-50%;

On the channel side, restart expansion and open core property stores. Q3 large goods stores reversed the net decline trend in the previous few years, with a net increase of 99 in the quarter, and it is expected that the net increase in Q4 will continue; Maintain a net increase in double-digit area every year through the replacement of large stores; China Li Ning and Li Ning Children maintain a net increase of about 100 per year, accelerating the release of the company's brand products and operating dividends.