CICC: Maintaining 361 degrees (01361) and outperforming the industry rating target price of HK$6.98

The Zhitong Finance App learned that CICC released a research report saying that the 2025/26 EPS forecast remains unchanged at 361 degrees (01361) of 0.61/0.72. The current stock price corresponds to 8.9/7.5 times the 2025/26 price-earnings ratio, and keeps the industry rating and target price of HK$6.98 unchanged, corresponding to 9 times the 2026 price-earnings ratio, with 18% room for improvement compared to the current stock price. The company announced the operating situation for the third quarter of 2025:361 degree, offline sales of major brands and children's clothing all increased by about 10% year on year, and e-commerce platform sales increased by about 20% year on year.

CICC's main views are as follows:

3Q25 continues previous good trends and actively lays out new retail formats

The 3Q25 361 degree main brand and children's clothing offline sales both achieved a year-on-year increase of about 10%, continuing the good performance since the beginning of the year. On a month-by-month basis, August performed best, but September was affected by fluctuations in the retail environment and faced some pressure. Retail discounts during the season were nearly 30% off, and the inventory ratio remained in the 4.5-5 times range. In line with the development trend of the new retail business, the supermarket business expanded rapidly, reaching 93 stores at the end of September; at the same time, it joined hands with Meituan to set up an instant retail business to empower offline business with online traffic. On the online side, e-commerce platform traffic increased by about 20% year-on-year during the quarter. The company continued to focus on top store placement and content dissemination, accounting for more than 80% of online exclusive products.

National Day sales remain resilient in a weak environment, and 4Q25 operations are confident

The retail environment continued the fluctuation in September during the 11th period. The company actively promoted online marketing exposure and launched top new products. Offline sales increased by about 3% year-on-year during the National Day, showing resilience. Management said it will actively prepare for Double Eleven and Double 12 sales, and is confident in the 4Q25 sales performance.

The 361 degree main brand conforms to the outdoor development trend, and ONEWAY offline is gradually laid out

361 Degrees is actively adapting to the domestic outdoor apparel boom and increasing product development efforts. The main brand has launched a new “Karuno” series of jackets, “hiking” outdoor shoes, and “Xeneng” cycling suits. In addition, ONEWAY, the company's Finnish outdoor brand, has opened offline stores since September, and has opened 6 stores in Zhengzhou, Beijing, Jinan, Daqing, Lhasa, and Xi'an as of early October. The management plans to continue to promote brand renewal and present consumers with pan-outdoor scene equipment options that combine professional outdoor aesthetics with urban simplicity.

Risk warning: The terminal retail environment falls short of expectations, industry competition intensifies, and channel expansion falls short of expectations.