HK-listed sportswear maker Xtep hits 5-week low; brokers trim targets

Xtep International Holdings

22/08/2019 04:56

** Shares of China sportswear maker Xtep International
Holdings Ltd  1368.HK  fall as much as 12.7% to HK$4.82, their
lowest since July 19
    ** Stock ranks 7th biggest percentage decliner in mid-
morning trade
    ** Fujian-based co's H1 profit rises 23% to 463 mln yuan
($65.50 mln) while revenue up 23% at 3.36 bln yuan. Xtep to
enhance store efficiency to drive organic growth and expand
footprint in Greater China and overseas  urn:newsml:reuters.com:*:nFWN25G0XQ
    ** Daiwa downgrades Xtep to "hold" from "buy" and cuts
target price to HK$5.40 from HK$5.80
    ** Sees limited room for re-rating as investments in Xtep's
new brands may take some time before it can provide a meaningful
contribution to the group
    ** CMB International trims target price to HK$6.72 from
HK$6.93 to factor in faster apparel growth and
greater-than-expected M&A related costs; maintains "buy"
    ** As of last close, stock up 29.9% this year
    ** Xtep has outperformed the Hang Seng Commerce & Industry
Index sector  .HSNC  by 21.5 percentage points in the past one
month
    ** The Hong Kong Hang Seng sub-index tracking consumer goods
companies  .HSCICG  gains 0.5%
    ** The Hang Seng China enterprises index  .HSCE  eases 0.4%,
benchmark index  .HSI  falls 0.8%
 
 ($1 = 7.0684 Chinese yuan)

 (Reuters Messaging: donny.kwok.thomsonreuters.com@reuters.net)