[Click eStock] "Fila Holdings, Costs and Time Needed Despite Mid- to Long-Term Strategy"... Target Price ↓

[Asia Economy Reporter Lee Jung-yoon] Eugene Investment & Securities announced on the 30th that although the direction of the 5th-anniversary strategy currently being implemented by FILA Holdings is positive, considering the costs and time required, the target stock price has been lowered from the previous 53,000 KRW to 44,000 KRW. However, the investment opinion of "Buy" was maintained.

FILA Holdings is executing its 5th-anniversary strategy called "Winning together." The main focuses are redefining brand value, building a customer experience-centered business model, and sustainable growth. Looking at the progress up to the first quarter of this year, notable points include changes in channel mix and expansion of sports categories. The proportion of low-priced channels in Korea and the United States has been reduced, and sales through DTC (Direct-to-Consumer), which sells products directly to consumers, have expanded. Online sales grew by 3% and 16% year-on-year in Korea and the United States, respectively. Additionally, a core sports tennis line was launched, which is viewed positively considering FILA’s origins in tennis-related products and the recent increased interest in tennis.

FILA Holdings’ sales for this year are projected to increase by 9.3% year-on-year to 4.15 trillion KRW, and operating profit is expected to rise by 12.5% to 554.5 billion KRW. Sales by business division are expected to be 468.5 billion KRW for FILA Korea, 68.5 billion KRW for FILA China, 628.6 billion KRW for FILA USA, 74.9 billion KRW for royalties, and 2.73 trillion KRW for Acushnet. Researcher Lee Hae-ni of Eugene Investment & Securities explained, "FILA Korea and the USA are making efforts to reduce the proportion of low-priced channels and increase the proportion of high-priced channels," adding, "It may be difficult to expect a clear increase in sales despite the strong reopening consumption from the first half to the second half."

She continued, "FILA China’s high growth is expected to slow due to lockdown effects, but its sales proportion is not large," and "The royalty division has provided guidance expecting 14% growth year-on-year due to a low base effect," adding, "The Acushnet division enjoyed strong performance during the COVID-19 period due to the golf industry boom, but a base burden is expected from this year."

This content was produced with the assistance of AI translation services.