裕元集团：全球头部运动鞋制造商，产能利用率修复带动盈利水平持续改善

Investment Rating - The report assigns an "Outperform" rating for the company [1]. Core Views - The company is the largest footwear manufacturer globally and one of the largest sports retail operators in Greater China, serving major international brands such as Nike and Adidas [4][10]. - The manufacturing business is showing signs of recovery, with a narrowing decline in revenue and improved order trends expected to enhance capacity utilization and income [4][5]. - The retail segment is also recovering, with significant growth in private channels and overall revenue increase [4][28]. - The company is expected to see a valuation correction in 2024, with a projected dividend yield of 8.3% based on a 70% payout ratio [5][29]. Summary by Sections 1. Company Overview - The company is a leading manufacturer of sports and outdoor footwear, with a significant retail presence in Greater China through its subsidiary, Bao Sheng [4][10][11]. - The controlling entity is Pou Chen Corporation, which holds a 51.1% stake in the company [12]. 2. Manufacturing Business - The manufacturing segment contributed 64.1% of total revenue and 84.2% of net profit in 2023 [17]. - The average selling price (ASP) reached a historical high in 2023, indicating strong demand for high-end products [24]. - The manufacturing business is heavily reliant on two major clients, which account for 61% of manufacturing revenue [25]. 3. Retail Business - The retail segment has shown resilience, with a 7.7% year-on-year revenue increase in 2023, driven by strong performance in private channels [4][28]. - The company has streamlined its retail operations, focusing on larger store formats to enhance efficiency [28]. 4. Financial Performance - The company’s revenue for 2023 was $7.89 billion, a 12$275 million, down 7% [6]. - The forecast for net profit from 2024 to 2026 is $370 million,$410 million, and $450 million, respectively [5][6]. 5. Valuation and Dividend - The report suggests a price-to-earnings (PE) valuation of 10-12x for 2024, translating to a target price range of HKD 17.82 to HKD 21.38 per share [5]. - The expected dividend yield for 2024 is projected at 8.3%, based on a 70% payout ratio [5][29].