CLSA has released a research report maintaining its Outperform rating on ANTA Sports (02020), with a target price of HK$110, and has included the company among its top picks.

The brokerage believes the company possesses a global footprint, combined with disciplined execution capabilities and a solid balance sheet.

The report forecasts that ANTA Sports will benefit from improved store productivity, outperformance of its outdoor brands, a potential turnaround to profitability for Jack Wolfskin's China market business next year, and higher net profit from Amer Sports. It expects the company's sales and adjusted net profit compound annual growth rates to reach 7% and 12% respectively for fiscal years 2026 to 2028.

The brokerage notes that holding a 29% stake in PUMA and owning Jack Wolfskin can broaden ANTA Sports' addressable market in professional sports and mass outdoor segments; productivity improvements, store format upgrades, and online growth are expected to offset store optimization efforts.

Demand in the third quarter of this year slowed compared to the first half. After July was affected by extreme weather, sales in August and September showed improvement. Golden Week and Double 11 will be key for the company to achieve its fiscal year 2026 performance guidance.

Additionally, international peers' inventory clearance has intensified online discounts, but ANTA Sports strictly controls discounting and expects the market competition environment to return to rationality in 2027.