Despite Anta profit, Chinese sportswear brands still struggling

A recovery in first-half profit growth at Chinese sportswear brand Anta (2020.HKG) does not mean that the rest of the sector is likely to return to see profits rising quickly, South China Morning Post reported, citing analysts. Rapid overexpansion coupled with poor sales and strong competition from global leaders has hurt the domestic sector and driven up company debts. As Anta chief executive Ding Shizhong said at the company’s August 6 results briefing, “our performance does not represent the industry. Not everybody can get out of this consolidation.” It remains to be seen whether competitors such as China Dongxiang (3818.HKG) and 361 Degrees (1361.HKG) can pull through.