In "Major Banks," China International Capital Corporation lowered the target price for BOSIDENG to 5.65 yuan. Performance is under pressure, but operational quality remains stable

CICC published a research report, indicating that BOSIDENG (03998.HK) is under performance pressure but has stable operational quality. The firm recently communicated with BOSIDENG's management, noting that the group's brand down jacket business performed slightly weaker than CICC's previous expectations against the backdrop of fluctuating temperatures and retail environments during the peak season; the OEM business saw a decline due to tariff fluctuations, which affected the fiscal year ending March 2026.

The firm stated that in a volatile environment, BOSIDENG's down jacket business was slightly below expectations, but the quality of growth is high. CICC expects that for the fiscal year 2026, the group's brand down jacket business is likely to achieve mid to high single-digit growth. By brand, it is expected that the main BOSIDENG brand will achieve mid-single-digit growth. The proportion of new product sales is expected to reach 85%, with a slight increase in average product price. Meanwhile, the Xuezhongfei brand is expected to perform excellently online, relying on a new product series, with anticipated revenue growth in the high double digits.

During the period, CICC also expects BOSIDENG's online business to perform well. At the same time, the group's offline business remains robust, with same-store sales expected to increase year-on-year. The OEM business is expected to record a high single-digit decline; however, as tariff disturbances gradually diminish, this business is expected to recover growth by the end of March 2027. Although revenue faces certain challenges, the group is expected to maintain inventory at a healthy level.

Considering that the retail environment in the market is expected to remain volatile, CICC has lowered its earnings per share forecast for the company for the fiscal years 2026 and 2027 by 6% and 9% to RMB 0.32 and RMB 0.34, respectively, with the current stock price corresponding to 13 times and 12 times the price-to-earnings ratio for fiscal years 2026 and 2027. The target price has been reduced by 4% to HKD 5.65, corresponding to 16 times and 15 times the price-to-earnings ratio for fiscal years 2026 and 2027, maintaining an "outperform industry" rating, with a 21% upside potential compared to the current stock price