Athletic Footwear & Apparel Industry Research: The Share War under K-Shaped Divergence — Running and Outdoor Capture Structural Dividends While Mass-Market Price Bands Are Still Bottoming

Report Date: 2026-10-09 ｜ Research Type: Full-Coverage Initiation (initial) ｜ Industry View: Cautiously Bullish ｜ Time Horizon: 12 Months ｜ Confidence: Medium

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I1 Industry Definition and Scope

This research covers athletic footwear & apparel brands and their upstream/downstream value chain: footwear and apparel with sports functionality at the core, divided by category into six segments — running/performance sports, outdoor/mountain lifestyle, yoga/women's fitness, basketball/team sports, mass-market athleisure, and kids' sports. A one-sentence value chain map: upstream functional materials (supercritical foaming midsoles, PEBAX elastomers, GORE-TEX-type functional fabrics) → professional contract manufacturers (Yue Yuen/Pou Chen, Huali, Feng Tay, etc., with capacity concentrated in Vietnam/Indonesia) → brand owners (the absolute core of the industry's profit pool) → channels (DTC direct-operated/e-commerce/distribution & wholesale, with third-party retailers such as Topsports and Pou Sheng). Scope note: excludes pure fashion/casual apparel (Uniqlo, ZARA, etc.) and outdoor hard gear such as tents and trekking poles, but includes outdoor functional apparel and footwear (Arc'teryx and Salomon apparel and footwear); athletic footwear & apparel accounts for more than one-fifth of global footwear and apparel sales (Euromonitor, 2026-06).

This is a brand-driven consumer industry: the essence of competition is brand mindshare and product iteration, not capacity scarcity. The focus of industry research lies in brand portfolios, pricing power, and channel inventory cycles; the price discovery mechanism is the retail discount rate rather than futures markets.

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I2 Demand: Moderate Growth amid K-Shaped Divergence

2.1 The Big Picture: 5% Nominal Growth, but the Actual Confidence Band Is Narrower

Euromonitor (2026-06) basis: global athletic footwear & apparel retail sales in 2025 were approximately USD 392 billion (backed out from its "over USD 500 billion by 2030, current-price CAGR of ~5%"), faster than the sub-4% pace of footwear & apparel overall. Given Nike management's guidance of a high-single-digit revenue decline for FY2027 (EPS of USD 1.15–1.35, well below market consensus) and Puma's consecutive revenue contraction (2026Q2 -9.4%), we apply a confidence band of 3.5%–5% for the overall market, with a base case of 4%–4.5% — the contraction of the two traditional giants (which together hold a double-digit global share) means a substantial portion of "share migration" is zero-sum; high growth at challengers cannot be fully extrapolated as incremental industry growth.

China market: per the China Sporting Goods Federation's Annual Development Report (2025), industry growth in 2025 was +7.38%, with revenue of 28 listed sporting goods companies up +6.62%. However, we must recognize the gap between reported growth and true retail growth: bottom-up retail estimates are around 4%±1pct, while total retail sales of consumer goods in 2026H1 grew only +1.3% (National Bureau of Statistics) — the gap mainly stems from consolidation effects and channel stuffing. This corroborates Li Ning's and Xtep's retail sell-through turning to low-single-digit negative growth from 2026Q2 (21st Century Business Herald/CBNData), one of the most important warning signals in the industry today.

2.2 Category Ranking: Running and Outdoor Are the Only Two Double-Digit Engines

Structural boom (volume and price both rising):

• Running/performance sports: US running shoes posted +13% in both sales and units in 2026H1, versus just +1% for footwear overall (Circana); China trail-running shoe online sales +82% (Tmall/Taobao white paper); 594 marathon events with 6.3987 million finishers in 2025, with 284 A-class certified events generating RMB 18.51 billion in direct economic impact and RMB 45.40 billion in knock-on effects (Chinese Athletic Association, "2025 China Marathon Blue Book"). The driver is the "carbon plate + supercritical foam" technology platform, which has transformed running shoes from durables into iteration-driven equipment — unit prices and replacement frequency both rising.
• Outdoor/mountain lifestyle: Amer Sports' Arc'teryx segment +32% and Salomon segment +37% in 2026Q2 (company filings); Anta's "Other Brands" (Descente/Kolon/MAIA/Wolf Claw) +44.2% in 2026H1; China's outdoor sports participation exceeds 400 million people with 2025 total consumption above RMB 1 trillion (General Administration of Sport basis); 2024-25 ski season visits reached 26.05 million (+12.9%).

Cyclical weakness (volume-price divergence):

• Yoga/women's lifestyle: lululemon FY26Q2 revenue -4%, comparable sales -9%, North America turned negative; FY26 guidance cut to -5%~-7% — tightening wallets of North American middle-class women plus weak product innovation; pandemic-era dividends have been fully digested.
• Basketball/team and retro sneakers: Nike announced the repositioning of Jordan Brand; Converse's latest quarterly revenue -28%; supply glut after sneaker culture's retreat.
• Mass-market athleisure: Nike FY26 revenue flat at USD 46.4 billion (-2% at constant currency), Li Ning 2026H1 +2.8%, Anta main brand +4.8% — tracking macro consumer spending power, volume up but price weak.

Note: Mixed bases (company segments/category markets); see individual sources. Data as of 2026H1 disclosures. Sources: company filings, Circana, Amer Sports 2026Q2.

2.3 Channel Inventory Cycle: Late Stage of Destocking, with "Structural Weak Restocking"

For brand consumer goods, "supply tightness" is gauged by channel inventory. Current picture (2026H1 reporting basis): Nike inventory USD 7.85 billion, -3% YoY (~111 days, healthy); Adidas EUR 5.97 billion, +13% (proactive stocking for the World Cup, in line with revenue); lululemon inventory +22% against revenue -4% — the most dangerous item across the two-tier system; Anta inventory turnover 130 days (-6 days YoY, including consolidated Wolf Claw); Li Ning turnover 65 days, all-channel inventory-to-sales ratio 4 months. At the channel level: major brands' inventory-to-sales ratios are broadly 4–5 months, hugging the upper bound of the healthy range; Anta's offline discount is stable at ~28% off retail (0.72 of ticket price), online ~50% off.

Judgment: No 2022-style industry-wide inventory crisis globally, but China's mass-market line shows "structural weak restocking" — reported inventory is healthy, channel levels are at the upper limit, and retail sell-through is weaker than reported figures. If sell-through does not return to positive growth by 2026Q4–2027Q1, there is a risk of repeating the 2022 discount spiral (this is the core controversy D2; see I7).

2.4 Demand Bridge: Global Increment of ~USD 127.1 Billion from 2025→2030

Bottom-up category bridge (base year 2025 at ~USD 391.8 billion; cross-checked against Euromonitor's top-down estimate with a deviation of ~+3.8% — passes):

• Running/performance (~25% weight) +USD 46.0 billion: 8%/year assumption, anchored to US running shoes +13%, On +21.6% cc, Xtep pro sports +11.4% (boom extrapolation with room for deceleration);
• Outdoor/mountain (~15% weight) +USD 40.3 billion: 11%/year assumption, anchored to Amer's 2026 guidance (raised twice within the year to ~+24%, a step down from 2025's +27%), Anta Other Brands +44.2%, and China's RMB 1 trillion outdoor consumption base;
• Mass-market/lifestyle (~45% weight) +USD 28.1 billion: 3%/year assumption, anchored to Nike -2% cc, Li Ning +2.8%, Anta main brand +4.8%;
• Kids/accessories/other (~15% weight) +USD 12.7 billion: 4%/year.

Structural drivers (running professionalization, outdoor penetration, emerging Asia-Pacific markets, women's segment) contribute ~3–4pct; cyclical items (macro consumer spending power, inventory and discounting, high base in 2027 after the 2026 World Cup year) contribute ~1–2pct. 2026E global market of ~USD 411.4 billion.

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I3 Supply: Contract Manufacturing Contraction, Brand Restraint, Inventory Divergence

3.1 Capacity Landscape: Vietnam + Indonesia Dual Bases, High Contract-Manufacturing Concentration

Athletic footwear manufacturing is highly concentrated among the Big Three contract manufacturers (each shipping over 100 million pairs annually; estimated CR3 of 35%–45% of global athletic footwear contract manufacturing): Yue Yuen/Pou Chen (2026H1 shipments of 118.6 million pairs: Indonesia 52%/Vietnam 33%/Mainland China 9%), Huali Group (2025 sales of 223 million pairs, 97.2% of capacity overseas; new Indonesia plant ramping with 2026H1 output of 4.39 million pairs), Feng Tay (Nike accounts for ~86% of its revenue and it supplies roughly 1/6 of Nike's footwear). Nike brand footwear FY25 capacity mix: Vietnam 51% + Indonesia 28% + China 17% — Vietnam + Indonesia combined at ~79%; this geographic concentration is the structural reason US tariff policy directly impacts the entire industry's cost base (see I6). Apparel contract manufacturing is represented by Eclat Textile (garment capacity ~10 million pieces/month, mainly in Vietnam).

3.2 2026: Volume-Price Squeeze on Contract Manufacturers — Order Front-Loading + Tariff Concessions

• Huali 2026H1 revenue -13.7%, net profit -43% (gross margin 17.7%, -4.15pct YoY), ASP ~RMB 105/pair (-4.6%, concessions to share tariff costs);
• Yue Yuen 2026H1 shipments -6.4%, manufacturing gross margin 14.3% (-3.4pct, already below the industry's comfortable 15–20% zone), explicitly stating it will "flexibly adjust the commissioning and ramp-up pace of new production lines";
• Vietnam's leather footwear exports to the US grew only +2.4% in the first 8 months of 2026 (vs +6.5% for full-year 2025).

Capacity expansion is broadly restrained: Yue Yuen is deploying flexibly, Feng Tay is substituting automation for line additions, and only Huali maintains orderly expansion in Indonesia/Vietnam. The industry's lead time from new capacity decisions to production is 12–18 months, plus another 6–12 months to full utilization — supply will not surge within a year, but it also means brand order cuts can quickly transmit into lower contract-manufacturer utilization and margins. Upstream materials: PEBAX (core raw material for supercritical foaming) is concentrated among a few producers such as Arkema; Arkema's +25% global capacity expansion has eased the bottleneck, and no evidence of hard shortages in carbon plates or high-elasticity yarns.

3.3 Product Portfolios: New-Product Cycle Turning Up, Retro-Casual Still to Be Cleared

• Nike: Professional lines accelerating annual iteration (Pegasus 42, Vomero 18/Plus priced at USD 230–240 for premiumization; Vomero was the No. 1 US search-volume running shoe IP as of 2025-12); lifestyle lines actively shrinking — the "Win Now" initiative cuts ~USD 2 billion of classic models and restructures Jordan.
• Adidas: Professional lines surging (2026Q2 Performance segment +39%, Adizero racing matrix + sub-100g concept shoes); retro lifestyle lines (Samba/Gazelle) under deliberate full-price shipment control; footwear revenue only +1%.
• On: CloudTec + LightSpray integrated spray-weaving continues; gross margin of 65.4% (2026Q2) is the industry's highest; but 2026 guidance has been cut to the low-20% growth range (Americas constant-currency growth slowed from 17% to 13%).
• Anta: Nitrogen technology platform + Milan Winter Olympics marketing cycle (spending compressing margins to 22.5%); ~2/3 of group growth comes from multi-brands (Descente/Kolon/MAIA/Wolf Claw +44.2%, share of revenue rising to 24.6%).
• Li Ning/Xtep: Strengthening mindshare in professional running IPs (Boom technology, Chaoqing/Feidian series; Xtep Saucony segment gross margin 55.5%), but Xtep's main brand growth has slid from +25.9% in 2022 to +1.5% in 2025.

Validity check on the discount-repair chain: For professional/outdoor lines, the chain of "supply clearing → discount narrowing → gross margin repair" has been established (On 65.4%, Anta 63.9%, Adidas 52.5%, Nike improving consecutively); for retro-casual/mass-fashion lines it has not (Adidas describes deep discounting in European retail; Nike's SW restructuring; lululemon's +22% inventory awaiting clearance).

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I4 Unit Economics and Pricing: A K-Shaped Discount Structure

4.1 Tiered Pricing Power: Who Can Raise Prices, Who Cuts Prices to Defend Volume

The industry's true price discovery mechanism is the retail discount rate (ticket prices are anchored by brands; actual transaction price = ticket price × discount). The current picture is a classic K-shape:

• Strong pricing power tier (full-price selling, sustainable price increases): On (2026Q2 gross margin 65.4%, +3.9pct YoY while fully absorbing US tariff costs), Arc'teryx/Salomon (Amer DTC +40.8%), Descente/Kolon (2025 gross margin 71.8%, the highest within Anta Group) — pricing power derives from technology iteration and scarcity, not ticket price hikes;
• Weak pricing power tier (deep discounting normalized): Nike China (FY26 Greater China revenue -11%; a classic model with a RMB 1,399 ticket price transacts at an average of ~RMB 765 on Dewu, i.e., ~45% of ticket), Adidas European channels, China's mass-market line (offline 28% off/online 50% off).

Mass-market discounts are at the deepest tier since 2021 (2021: Anta DTC self-operated at ~0.76–0.77 of ticket vs 0.72 currently; online at 50% off is approaching 2022–2023 destocking crisis levels); professional/outdoor lines are at the shallowest discount tier. The essential difference from 2022: this is not an industry-wide inventory crisis, but a structural price concession in homogeneous mass-market products.

4.2 The Markup Chain and Profit Distribution: Who Gets the Money from a Pair of Shoes

Taking a mass-market running shoe (RMB 500 ticket price tier) as an example: factory gate price ~RMB 100 (Huali ASP RMB 105/pair, Yue Yuen USD 20.95/pair; contract manufacturing gross margin 14%–18%) → brand wholesale price ~RMB 250 (brand gross margin 62%–64%) → retail ticket price RMB 500 (mass-market markup multiple ~5x) → actual transaction: ~RMB 360 offline (28% off)/~RMB 250 online (50% off). The retail tier (Topsports) has a gross margin of 38.0% but a net margin of only 4.9% — for the same pair of shoes, the brand captures over 60% of the value chain's gross profit; manufacturing and retail are mere pass-throughs. DTC redistribution continues: Anta's e-commerce share has risen to 35.8%, with FILA/Descente/Kolon/Arc'teryx essentially fully direct-operated; Nike, by contrast, is swinging back (FY26 DTC -6%/wholesale +6%), validating that an optimal channel structure exists rather than "the more DTC, the better."

4.3 Single-Store Model: High-End Outdoor Store Productivity Is 8–11x That of Mass Brands

Store expansion is concentrated in high-end outdoor (Descente +30 stores in 2025, Kolon +18), while mass-market lines are closing stores to improve efficiency (Topsports store count -13.1%, Li Ning net-optimizing underperforming stores) — the gap in single-store economics is the physical manifestation of brand premium.

4.4 Base-Case Price Path (Next 12 Months)

Pricing framework: inventory levels (Anta 130 days / lulu +22% compressing the mass-market floor) × new-product cycle (running/outdoor iteration supporting professional full-price) × competitive intensity (mass-market line's multi-player scuffle vs Nike's de-promotion discipline).

Corresponding three price scenarios: bear case (probability 0.30) — discounts widen to 30% off offline/55% off online, industry-wide ASP -3%~-5%; base case (0.50) — mass-market discounts flat, ASP +1%~2%; bull case (0.20) — discounts narrow to 0.73–0.75 of ticket, ASP +3%~4%. (Outdoor ASP assumption has been revised down from +5%~8% to +2%~5%: On's Americas deceleration, Xtep Saucony segment's sharp slowdown to +11.4%, and Li Ning/Xtep pushing carbon-plate running shoes down into the RMB 300–500 band — the professional price-band defense line in China is being eroded by value pricing.)

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I5 Competitive Landscape and Profit Pool: The Share War on Three Fronts (Industry Headline)

5.1 Globally: Two Giants Contracting, Professional Challgers Encroaching — but the Slope Is Stepping Down

Nike leads with a global share of ~12.7% (2025E, Euromonitor via Ebrun), with FY26 revenue flat at USD 46.4 billion (-2% at constant currency) and FY27 guidance for a high-single-digit decline; Adidas ranks second with revenue of EUR 24.8 billion (2025, a record). The rising tier: On +30% in 2025, Asics +19.5%, New Balance +19%, HOKA +15.9%. But in 2026 the challengers' growth slopes have broadly stepped down: On 2026Q2 constant currency +21.6% (slowing 8.4pct from 2025's +30%), Americas growth down from 17% to 13% (stock fell -19%~-22% on earnings day); Amer's 2026 guidance of ~+24% (a step down from 2025's +27%); the International Association of Department Stores (IADS, 2026-07) observed a marked slowdown in the running shoe "supercycle." Running/outdoor remain the growth engines, but extrapolating their "structural" nature warrants a measure of restraint — it took lululemon only one year to go from +5% to -4%.

5.2 China: Domestic Brands Advancing as Foreign Brands Retreat + Outdoor Harvest, Anta Group Takes the Crown

• Nike's China share fell from 18.1% in 2021 to 16.2% in 2024 (-1.9pct, Euromonitor single-brand basis); FY26 Greater China revenue -11%, continuing to decline in 2026Q1, with digital channels -25%; Adidas was overtaken by Anta/Li Ning in 2024. China CR5 ~58% (2021, Euromonitor/China Sporting Goods Federation).
• On a group basis, the Anta system is already de facto No. 1 in China: 2025 revenue of RMB 80.22 billion (+13.3%), gross margin 62.0%; including consolidated Amer Sports, its scale exceeds Nike Greater China; ~2/3 of growth comes from the multi-brand matrix (FILA RMB 28.47 billion, +6.9%; Descente + Kolon etc. "Other Brands" RMB 17.0 billion, +59.2%, with Descente sell-through surpassing RMB 10 billion).
• In the outdoor track, the Anta system harvests the high end (Arc'teryx/Salomon via Amer, Descente/Kolon direct-operated), while Kailas/Pelliot (2025H1 +62.3%)/Camel grab the mass market with value-for-money alternatives.

5.3 Mind Share: Marathon Wearing Rate Is a Hard Metric of Brand Strength

Note: This metric is a sampled wearing rate among runners (evidence of mind share), not market share; it differs from the industry concentration CR caliber used in I5.1/5.2. Source: JoyRun Data Research Institute (sample of sub-3 finishers at the 2025 Shanghai Marathon). Domestic brands have overtaken international giants in the minds of elite runners — Xtep + Saucony combined ranked first in overall wearing rate across 6 major domestic marathons in 2025 (company-caliber).

5.4 Profit Pool: Money Is at the Brand End, and Concentrating in Brands with Pricing Power

• Brand end — China: The four major domestic brands posted combined 2025 net profit attributable to shareholders of ~RMB 19.21 billion (Anta 13.59 + Li-Ning 2.94 + Xtep 1.37 + 361 Degrees 1.31); Anta's ROE was 21.3% with operating cash flow of ~RMB 21.0 billion.
• Contract manufacturing end: Hua Li's 2025 gross margin was 21.9% (-4.9pct, lowest since listing); 2026H1 net profit fell -43% — tariffs forced by brands onto suppliers (conceding ASP -4.6%) plus order pull-forward created a double hit, a living specimen of "demand boom diverging from segment returns."
• Retail end: Topsports' FY2025/26 revenue fell -4.7% (third consecutive decline), with net margin at 4.9% (vs. 7.6% in FY2024) — DTC conversion is systematically clawing channel profits back to brands.

Direction of profit migration (next 2-3 years): ① Tariff costs shared among brands-manufacturers-consumers, compressing OEM gross margins; ② migration from mass price bands to professional/outdoor premium bands (incremental profits almost entirely from high-margin expansion of Arc'teryx/Salomon/Descente/On/HOKA); ③ transfer of channel profits to brands is nearly complete. Conclusion on bargaining power: brands are strong both upstream (multi-source procurement, annual price negotiation) and downstream on channels (rebates + inventory buyback obligations); toward consumers they are severely bifurcated — On/Arc'teryx hold pricing power, while mass lines see intense promotion.

5.5 Brand Matrix

5.6 Profiles of Key Players

5.7 Anta-Puma: Cracks in the Summit Narrative

On 2026-10-07, Anta completed the acquisition of a 29.06% stake in Puma SE for EUR 1.506 billion (EUR 35 per share, ~62% premium to the pre-announcement close), becoming the largest single shareholder — the first time Chinese capital has entered the ownership tier of a global second-tier brand, with Anta group's governed global revenue approaching Adidas's. But the deal sits in tension with the "undervalued" thesis: the day after completion, Puma traded at ~EUR 22.4, implying an immediate mark-to-market loss of ~36% (~RMB 4.4 billion, roughly one-third of Anta's 2025 net profit); Puma's 2025 revenue declined and EBIT turned to a loss, with 2026Q2 revenue -9.4% and EBIT still at a EUR 53.1 million loss with no turnaround timetable; at 29.06% there is no control (Anta has explicitly ruled out a full tender offer), and the FILA-style deep-integration playbook is hard to replicate. Equity-method losses and potential impairments will test the quality of the "profit harvesting machine" (core controversy D3).

5.8 Sector Valuation Position: Two Readings of the Bottom Zone

HK-listed sportswear (2026-10-09): Anta PE TTM 11.0× (decade 1st percentile), PB 2.46; Li-Ning PE 9.5×/PB 1.00 (decade 0th percentile); Xtep PE 6.8×/PB 0.80; 361 Degrees PE 6.2×/PB 0.76. US stocks: Nike ~16.5× (near decade low), lululemon ~8.5× (decade-low range), Deckers ~11.3× (decade median 22.8×), On ~22× (priciest). A-shares: Shenwan apparel & textiles PE 27.15× (49th percentile since 2014), PB 1.81× (33rd percentile) — the main battleground for sportswear is HK-listed names, at historically absolute valuation lows.

Both readings must be juxtaposed: First, the market has priced in "price war + tariffs" but not "share migration + profit pool concentrating at the high end" — room exists for an expectation-gap closure. Second, the denominator of those low percentiles is cyclical earnings — Li-Ning traded above 30× PE at its 2021 earnings peak, and the subsequent "cheaper as it falls" came alongside sell-through sliding from high double digits into negative territory; Anta's RMB 13.59bn net profit includes consolidation and one-off items (if the denominator is inflated by 15%, true PE is ~12.9×), and does not yet reflect the Puma equity-method loss path. A low percentile is a necessary condition; earnings stabilization is the sufficient condition.

5.9 Return Quality Conclusion

This is a business where the brand end makes money overall, but makes "structural money": high and sustainable returns are concentrated in multi-brand platforms (Anta ROE 21.3%) and premium professional brands with pricing power (On gross margin 65.4% with over CHF 1bn in cash; FILA/Descente store productivity ceilings continuously rising); the illusion of revenue growth without profit growth exists in China's mass price bands (Li-Ning three consecutive years of revenue growth without profit growth; Xtep 26H1 operating profit -11%) and in the OEM/third-party retail segments (Hua Li, Topsports) — studying this industry requires distinguishing "category heat" from "segment profitability."

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I6 Policy · Geopolitics · ESG: Tariffs Not Yet Settled, Chinese Policy the Strongest Tailwind

6.1 US Tariffs: From Chaos Toward a "~20% Wall"

Timeline: 2025-04 reciprocal tariff threats (Vietnam 46%/Indonesia 32%) → Jul-Aug 2025 agreements landed (Vietnam 20% + 40% transshipment, Indonesia 19%, China ~30%) → 2026-02-20 US Supreme Court ruled 6:3 that IEEPA tariffs were unlawful and struck them down (~USD 166bn in collected duties entering the refund process) → the administration switched to Section 122 global 10% surtax (expiring 2026-07-24; ruled unlawful by the trade court in the interim, under appeal) → currently: Section 301 nominal surtax of 10%/12.5% (Vietnam's 12.5% effective and being paid since 2026-09-25) layered on footwear MFN base rates (highest among consumer categories, averaging over 12%). The Footwear Distributors and Retailers of America (FDRA) expects most origins' all-in rates to eventually settle at ~20%; USTR has separately launched Section 301 investigations into China, Vietnam, Indonesia, Cambodia, and India on "overcapacity" grounds — an incremental risk.

Quantified brand impact: Nike FY26 tariff cost annualizing to ~USD 1.5bn (gross margin headwind raised from 75bp to 120bp); Adidas 2025 direct operating profit impact of EUR 120m (full-year total impact ~EUR 400m); Deckers FY26 ~USD 150m. Watch for one-off items: Nike FY26Q4's +890bp gross margin came mainly from the reversal of USD 986m in IEEPA tariff refunds — not an operating improvement. Overall judgment: the tax burden has fallen significantly from the 2025 peak (19%-30%), but evidence that "the worst is over" is insufficient — if the 301 overcapacity investigation lands on top, brand gross margins still face 50-100bp of downgrade risk in FY27.

6.2 China Policy: The RMB 7 Trillion Sports Industry Anchor for 2030

The State Council's "Opinions on Unleashing Sports Consumption Potential and Further Advancing High-Quality Development of the Sports Industry" (2025-09, the "20 measures on sports consumption") targets total sports industry size exceeding RMB 7 trillion by 2030; the "15th Five-Year" National Fitness Plan (2026) targets ~40% of the population regularly exercising and ~4 square meters of sports space per capita by 2030; State Council Document No. 28 [2026] (2026-09-25) laid out 17 tasks for the events economy. Trade-in subsidies do not directly cover sportswear (indirect benefit only). Policy constitutes a clearly directional medium-term tailwind for domestic demand, in contrast to cautious European and US discretionary consumption.

6.3 EU and FX

The EU's CSDDD, as amended by Omnibus I, has been postponed to 2029 and narrowed to very large companies (compliance costs deferred and lightened); ESPR bans large companies from destroying unsold apparel and footwear from 2026-07-19 (affects inventory-clearance strategies), with the textile ecodesign delegated act expected in 2027. FX: RMB appreciated ~6% over 12 months (7.14→6.73), raising the USD cost of Chinese capacity — negative for export-oriented OEMs, largely insulated for China domestic brands; VND stabilization has narrowed Vietnam's sourcing dividend.

Net direction: neutral-to-stable, structurally divergent. Beneficiary ranking: China domestic-demand-driven brands ＞ premium brands with pricing power to pass through costs ＞ OEMs (direct price pressure + 301 investigation scope risk) ＞ brands/retailers with large US exposure and weak pricing power.

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I7 Core Controversies and Scenarios

D1 Is Running/Outdoor a Structural Trend, or the Next Fashion Fad Fade?

• Bulls: Technology platform repricing (carbon plates + supercritical foams turned running shoes into iterating gear), participation rates underpinning volume (6.3987 million marathon finishes, 400 million outdoor participants in China), Amer's 2026 guidance raised twice within the year to ~+24%, continuously rising premium outdoor store productivity — a consumption upgrade of "function replacing fashion."
• Bears: The growth slope has stepped down (On Americas 17%→13%, Amer 27%→24%, HOKA +24%→+7.7%; IADS notes the supercycle is slowing); Arc'teryx's luxury-ification + logo proliferation is the classic path of a lululemon-style hype cycle; lulu went from +5% to -4% in just one year.
• Metrics to track: On Americas constant-currency growth (below 10% falsifies "structural"), Amer quarterly guidance, marathon participation and carbon-plate shoe ASP, Arc'teryx China same-store growth.

D2 Depth of China's Mass-Market Price War: Reported 7.4% or Retail 4%?

• Bulls: Policy backstop (RMB 7tn target + events economy), improving inventory discipline (Li-Ning gross margin +0.9pct, Anta turnover -6 days), conditions for a 2022-style industry-wide inventory crisis absent.
• Bears: The 3.3-6.1pct gap between reported and retail figures implies channel stuffing (Li-Ning 26H1 reported +2.8% vs. mid-single-digit decline in sell-through); stock-to-sales ratio at 4-5 months, hugging the ceiling; carbon-plate running shoes pushed into the RMB 300-500 band — the price war is creeping from mass bands into entry-level professional; if 2027 reported growth mean-reverts toward retail sales (+1.3%), the discount spiral repeats.
• Metrics to track: Li-Ning/Xtep 2026Q3-Q4 sell-through (declines widening to mid-single digits as a deterioration signal), leaders' stock-to-sales ratio (above 5 months is the red line), Double 11 discount depth, Anta e-commerce growth.

D3 Anta-Puma Integration and the Quality of the "Valuation Floor"

• Bulls: Anta's multi-brand platform has two successful integration records (FILA/Amer); Puma's valuation is in a historical low range, and synergies (supply chain, China market, APAC channels) are real; HK-listed 11× PE already prices in the bear case.
• Bears: A 62% premium for legacy shares from financial investors with an immediate mark-to-market loss of ~RMB 4.4bn; 29.06% with no control, Puma's EBIT loss and no turnaround timetable; equity-method losses + impairments will erode the denominator of the "11× floor"; Li-Ning/Xtep's low percentiles, amid earnings downgrades, are merely "left-side cycle marks."
• Metrics to track: Puma equity-method P&L and impairment testing in the March 2027 annual report, Puma quarterly EBIT, Anta main brand + other brands sell-through, whether Li-Ning sell-through turns positive.

Scenarios (12 months)

Catalyst Calendar

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I8 Investment Implications and Beneficiaries

8.1 Industry Momentum × Business Quality Decision Matrix

Debunking the value trap: An upswing in industry momentum ≠ worth buying. Huali Group and Topsports sit in the lower-right quadrant—athletic footwear and apparel demand is still growing moderately, but OEM profit is being eaten away by tariff cost-sharing and brand-driven price compression (Huali 1H26 net profit -43%), while third-party retail profit is being systematically siphoned off by the shift to DTC (Topsports net margin 7.6%→4.9%, revenue down three years in a row): both are typical carriers of the "industry momentum illusion"—what should be avoided is the segment, not the companies per se. Nike/Li Ning/lululemon in the upper-left are turnaround candidates—brand equity and return quality remain intact, awaiting confirmation of a momentum inflection; Xtep (not shown) falls between the lower-left and upper-left: main brand stalling + Saucony decelerating + operating profit declining, so a low valuation is not a reason to buy until earnings stop falling.

8.2 Beneficiaries and Stocks to Avoid

Top picks (base case):

• ANTA Sports (02020.HK): A multi-brand matrix is the optimal answer to China's K-shaped divergence in sports consumption—main brand steady, FILA recovering, outdoor matrix +44.2% taking over as the growth driver; 11x PE / 1st percentile over ten years provides downside protection; the cost is Puma integration uncertainty (already priced in D3; the 2027 annual report is the test point).
• Amer Sports (AS.N): Arc'teryx/Salomon are the purest plays on "premiumization of outdoor + consumption upgrade in China"; 2026 guidance of roughly +24% remains among the fastest globally; one must accept that valuation has already partially priced in the momentum.
• 361 Degrees (01361.HK): The only domestic brand with five consecutive years of double-digit growth, powered by three engines—downmarket value-for-money, kids' apparel, and overseas; net margin steady to rising, PE 6.2×—earnings have not stalled, so a low valuation works here; in a bull scenario, its upside is weaker than peers'.
• On Holding (ONON.N, second choice): The combination of the industry's highest gross margin and fastest growth remains scarce, and the deceleration has been partially priced in by the stock (single-day -19%~-22%); however, a 22x valuation + Americas deceleration make it the most sensitive to a D1 falsification—suitable as a satellite position, not core.

Avoid:

• Huali Group (300979.SZ): Order growth ≠ profit growth; the dynamics of tariff cost-sharing + brand-driven price compression remain unchanged, and the Section 301 investigation is a tail risk.
• Topsports (06110.HK): The transfer of channel profit to brands is nearly complete; revenue down three years in a row, net margin halved and still falling, with Nike's reclaiming of online distribution rights adding a further gap.

8.3 Scenarios × Stocks

8.4 Key Risks

① China's mass-market price war spreading up into technical price tiers and a repeat of the 2027 discount spiral (D2 red line: inventory-to-sales ratio breaking above 5 months); ② the running/outdoor hype cycle peaking (D1 falsification signal: On's Americas constant-currency growth falling below 10%); ③ US tariffs settling back to ~20% plus Section 301 overcapacity tariffs, with brand gross margins revised down another 50-100bp; ④ ANTA's Puma equity-method losses and impairment (floating loss exposure of ~RMB 4.4 billion); ⑤ reversal of public sentiment and hype cycle for premium outdoor brands such as Arc'teryx; ⑥ a high-base decline in global team sports categories in 2027 after the 2026 World Cup year.

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This report is industry-level research. Company-specific deep dives (target prices, position sizing) for the above stocks can be found separately in their respective company files. Key data sources are listed in industry_view's key_sources.