XTEP And Baosheng Listed In Hong Kong

One is Nike, Adidas and other famous sports brand distributors - Baosheng International (03813, HK); one is the mainland famous sporting goods retailer XTEP China (01368, HK), although the sale of different brands of sneakers, but are selected at this time to Hongkong listing, and in May 16th held a IPO roadshow, in the Xiangjiang listed competition.

The first round: brand awareness competition, if it is about brand awareness, Baosheng international is the world's largest brand sports shoes manufacturer Yuyuan group (00551, HK) spin off.

Preliminary prospectus shows Baosheng international distributes sports shoes for some international and mainland sports shoes brands, including Nike, Adidas, Adidas, Kappa, Converse, Reebok and so on.

As of the end of last year, Baosheng international operates 1324 retail outlets directly in the mainland.

By the end of last year, the company is the largest retailer of Adidas and Lining brands, the second largest retailer of Nike, and the largest retailer of Kappa, PUMA and other brands.

In Fujian, Quanzhou, China, which has its own factory building in XTEP, mainly owns XTEP brand and Colin brand.

In addition, in November 2006, XTEP obtained the franchise and launched the Disney Sports brand.

According to statistics, according to the 2007 earnings, XTEP brand is the largest fashion sporting goods brand in the mainland. In 2007, it accounted for about 3.4% of the mainland sporting goods market.

According to Kai Chi securities analyst, although Baosheng's brand is better known than XTEP, XTEP China has its own brand, and the company will gain brand value.

So Baosheng's brand reputation is high, but it is also hard to say that it is better than the second round of XTEP: the scale of issuance and price competition, although the issuance intervals of the two companies have not been disclosed in the initial prospectus, but the news from the roadshow May 16th shows that Baosheng international plans to issue 823 million 400 thousand shares from HK $2.93 to HK $3.75 per share, raising funds from HK $2 billion 413 million to HK $3 billion 88 million, and issuing shares account for 23.2% of the total share capital of the company.

Baosheng international will offer public offering from May 26th, and its shares are expected to be listed on June 6th (Friday).

The sponsor is Merrill Lynch and Morgan Stanley.

According to the sponsor's 2008 forecast report, Baosheng international distribution range is about 16 times to 24 times the forecast price earnings ratio in 2008.

XTEP China plans to sell 550 million shares at HK $4.05 to HK $5.5 per share, raising HK $2 billion 228 million to HK $3 billion 25 million.

It is reported that XTEP will open for public offering in May 21st, and its shares will be listed on June 3rd (Tuesday).

The sponsor is UBS and Morgan chase.

According to UBS, one of the sponsors, XTEP has a net profit of about 474 million yuan this year, and its issuance range is 17 times to 23 times the 2008 forecast earnings.

From the above data, we can see that the two companies are equal in terms of the size of the issue, the issue price earnings ratio or the sponsor's lineup.

The third round: whether IPO can attract market attention, a good strategy investor can sometimes become a "live sign".

Initial prospectus disclosure revealed that in June 2007, the famous private equity fund Carlyle invested in XTEP in the form of convertible loan agreement. At present, the Carlyle fund holds a 9.6% stake in XTEP China.

However, the strategic investment of Carlyle fund also laid the seeds for XTEP to face the pressure of lifting the ban in the future.

The disclosure of the Prospectus Documents shows that the selling period of the Carlyle fund is six months from the date of the listing of XTEP. For a new listed company, the six month ban period is not very long.

In addition, the price of Carlyle's stake in XTEP is only HK $1.55, which is far below the issuing range of HK $4.05 to HK $5.5 per share, and lucrative profit or acceleration of Carlyle's profit exit.

Sameul, an analyst at Kai Ji securities, thinks that XTEP China is somewhat similar to Anta sporting goods (02020, HK). From Anta's post listing performance, investors are very keen on such mainland retail stocks. Investors who are optimistic about the mainland's retail concept may consider buying XTEP.

Baosheng international is a group of Yuyuan group which is split from the old Taiwanese capital stock. Yuyuan is a Taiwanese capital listed company with better brand image in the Hongkong market. This will also add a lot to IPO.

The two new shares have their own selling points, but the recent heat market for the new stock market is not good enough. Investors can wait and see the stock market reaction before deciding whether to enter the market.