[ET Net News Agency, 28 August 2019] Morgan Stanley raised its target price for
Shenzhou International (02313) to HK$140 from HK$120 and maintained its "overweight"
rating.
The research house said its deep analysis (survey of >600 products) suggests that
Shenzhou's total addressable exposure to Nike, Adidas and Puma products is 45%, 40% and
67%, respectively (in terms of value), still far from its current wallet share in Nike
(16-17%), Adidas (13-14%) and Puma (40%).
Morgan believes Shenzhou will continue to gain share within these brands given ongoing
supply-side consolidation and its strong partnerships with the brands. It sees abundant
market share gain opportunities with these brands in the next three years for Shenzhou.
Morgan expects Shenzhou in aggregate to reach 24% market share with Nike, Adidas and
Puma by 2022, versus 17% in 2018, supporting an 18% revenue CAGR in 2019-22. (KL)