3QFY25（2024年9月至11月）滔搏全渠道收入同比下降中单位数，环比上季度的低双位数下滑有所收窄。CICC released a research report stating that maintaining Taobo's (06110) “outperforming the industry” rating, the FY25/26 EPS forecast remained unchanged, and the target price of HK$3.1 remained unchanged, corresponding to 14/10 times the FY25/26 price-earnings ratio. The company announced 3QFY25 (September-November 2024) operating performance: the total sales amount of retail and wholesale business declined year-on-year in the number of units, and the gross sales area of direct-run stores decreased by 2.1% compared to the end of August.
CICC's main views are as follows:
The decline in quarterly turnover growth rate narrowed month-on-month, with inventory as the core element guiding operations.
The year-on-year decline in 3QFY25 (September-November 2024) Taobo omnichannel revenue declined in units, and the month-on-month low double-digit decline narrowed compared to the previous quarter.
By channel, the decline in retail channel traffic during the season was slightly better than that of franchise channels. Channel optimization was still ongoing. The gross sales area of direct-run stores decreased by 4.4% year on year and 2.1% from the end of August. As of the end of November, the number of Taobo direct-run stores decreased by a high number of units year on year, and the average area of a single direct-run store was still increasing year over year; online sales continued to grow rapidly. The company continued to grow rapidly. The 3QFY25 online market had a double-digit year-on-year increase.
In terms of inventory and discounts, the company used “year-on-year inventory improvement at the end of FY25” as the core goal. Retail discounts were appropriately liberalized during the 3QFY25 season to control inventory. At the same time, due to an increase in online share, the company's retail discounts during the quarter deepened year-on-year. As of November, Taobo's inventory removal progress was in line with expectations, and the inventory sales ratio remained within the normal range of 4-5 at the end of 3QFY25. By category, the growth rate of professional sports categories during the season was faster than that of popular sports categories, and the sports and leisure category was under relatively high pressure to grow.
The main brand Nike is actively making adjustments.
Nike, one of Taobo's main brands, is currently making active adjustments on the product side. The bank expects the brand to innovate in professional sports segments such as running and outdoor activities. As Nike's excellent strategic partner in China, Taobo is also discussing the implementation of brand marketing and sales in China. Looking forward to the future, the bank expects the Nike brand to gradually come out of the adjustment period and bring flexibility to Taobo's revenue growth.
Risk: Competition in the industry intensifies, and the terminal retail environment falls short of expectations.
