The hottest sportswear brand in the world today, at least in the stock market, is a Chinese company founded by a former Olympic athlete: Li Ning.
Since the beginning of the year, Li Ning shares listed on the Hong Kong stock market have more than tripled, which enables it to be among the best-performing stocks in the MSCI Asia Pacific and Best gain in the group of textile companies globally.
Li Ning is benefiting from the growing Chinese appetite for sportswear. According to Morgan Stanley, the bank has just raised the target price for Li Ning shares by 33%. In addition, the scandal surrounding Hong Kong protest after a controversial statement from the basketball team manager of Houston Rockets of the American NBA professional basketball tournament also triggered a wave of support for domestic brands to patriotism, of which Li Ning is one of the brands to benefit.
This is not the first time that Li Ning stock has soared since its listing in 2004. This stock has achieved similar levels in 2007 and 2010, before plummeting and remaining flat in the past few years. due to making some business strategy mistakes.
This time, the momentum came from the end of last year in the context of investors seeking consumer companies rated as immune to the economic slowdown and trade war. Li Ning’s rival Anta has also seen its stock increase 87% since the beginning of the year.
Although Li Ning’s stock looks expensive with a P / E of 35 times, compared to Nike’s 30 times and Adidas’s 25 times, analysts are still very optimistic about the stock. Among Bloomberg survey experts, 28 recommended buying, 6 were neutral and no one recommended selling.
The company was founded in 1990 by Li Ning – a famous Chinese Olympic athlete. After retiring, he built a professional sports equipment company. The company specializes in manufacturing footwear, apparel and other accessory products for a range of sports such as basketball, football, tennis, swimming and bodybuilding.