Anta: Double-Digit Sales Growth Despite Weak China Macroeconomic Environment

Narrow-moat Anta’s second-quarter operational update was in line with our estimates. Excluding its Amer Sports division, the company reported about 10% year-over-year growth in retail sales, driven by the resilient performance of the core brand and the outperformance of its high-end brands, Descente and Kolon. Given the robust second-quarter sales, management reaffirmed its 2024 guidance and emphasized that stringent cost controls, particularly in areas like rent and marketing, will bolster the firm's ability to preserve margins, even if sales growth slows.