[Click eStock] Fila Holdings, Target Price Maintained at 49,000 Won

Hi Investment & Securities maintained a target price of 49,000 KRW and a buy rating for Fila Holdings on the 10th.

They forecast that the operating profit for the first quarter will fall short of market expectations. Fila Holdings' first-quarter sales are expected to be 1.0993 trillion KRW, with an operating profit of 128.1 billion KRW. While sales are expected to increase slightly, operating profit is projected to decline by about 24% compared to the same period last year.

This is attributed to continued discount sales in Fila USA, channel expansion and restructuring in Fila Korea, and marketing expenditures aimed at enhancing the global Fila brand.

Excluding design fees from China, Fila Korea's sales are expected to be 111.7 billion KRW (-4.4%), with an operating profit of 5.7 billion KRW (-41.4%). This takes into account ongoing channel adjustments and overall weak sales in January and February. However, from March, the impact of spring-summer season product sales is expected to gradually appear, and in the second quarter, strong sales of new products and the effect of price increases are anticipated to positively reflect on operating performance.

Based on the recovery of consumer sentiment in China, Anta Sports has presented a double-digit growth guidance. Accordingly, the outlook for growth in design fee sales for Fila Korea is also positive. Fila USA's sales are expected to be 94.7 billion KRW (-30%), with an operating loss of 28.4 billion KRW. Inventory levels remain high, making inventory reduction an urgent priority. This year, margin deterioration is inevitable due to discount sales. However, after inventory normalization, new product launches by the Global Team and the Futura Team are scheduled. Researcher Park Ikyung of Hi Investment & Securities forecasted, "The effect of brand power improvement could lead to rapid margin improvement."

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