Changjiang Securities: The “buy” rating of Bosideng (03998) is expected to build a multi-brand group

The Zhitong Finance App learned that Changjiang Securities released a research report stating that the net profit of Bosideng (03998) FY2024-2026 is expected to be 36/41/4.6 billion yuan respectively, up 18%/13%/12% year on year. The corresponding valuation is 13/12/11X, giving a “buy” rating. Recently, Bosideng announced an investment in the Canadian luxury down jacket brand Moose Knuckles. Moose Knuckles has opened 36 stores in China, North America, and Europe, and distributed through well-known retailers such as Harrods, Selfridges, Saks Fifth Avenue, and Holt Renfrew.

Changjiang Securities's main views are as follows:

Acquire high-end down jackets and build a multi-brand group.

Considering that this investment amount is small, the equity ratio is low, and Moose Knuckles is small, there will be no fluctuation in the overall performance of the company. In the short term, the company plans to help its development in the Chinese market through Bosideng resources and build a multi-brand matrix of Moose Knuckles, Bosideng, and Snow Flying. It is also expected to further expand overseas business through the Moose Knuckles brand in the future.

Short-term retail data is excellent, and Moose Knuckles is expected to contribute to growth.

1) Sales of high unit price sunscreen clothing are good this year. It is expected that sales will reach sales targets throughout the year and help the brand enter the high-quality channel position in the business district; 2) Jacket racetracks are booming, and sales of single case jackets are expected to be excellent in spring, and sales of styles will increase in fall; 3) OEM is in the inventory replenishment cycle this year. OEM revenue is +16% compared to last year, and is expected to continue to increase this year. 4) The acquisition of Moose Knuckles creates a multi-brand matrix, empowered by Bosideng brand resources. Moose Knuckles is expected to accelerate growth in the short term, contribute to investment returns, and medium- to long-term brands can also be expected to go overseas.

Product structure adjustments are flexible, and cooling is expected to accelerate retail sales.

1) Judging from the company's high unit price sunscreen and jacket sales, Bosideng brand functional products have not been affected by significant consumption downgrades; 2) Dealers still have strong order confidence before, and the company can adjust the product structure flexibly according to sales performance; 3) Under the rise in the price of goose down raw materials and uncertain terminal consumer demand this year, most domestic down jacket brands are conservative in orders, and the industry competition pattern is expected to be optimized; 4) It is expected that offline streaming will continue to maintain a good growth trend in recent months. Gold growth has accelerated in the past 11 weeks, and the national consumption policy and national consumption policy will be stimulated. The cooling is expected to continue Further catalyze a boost in retail sales.