In-Depth Investment Value Analysis Report of 361 Degrees (1361.HK)

Based on the collected data and analysis, I will provide you with a comprehensive investment value analysis report of 361 Degrees.

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361 Degrees’ Q4 2025 operating data disclosed on January 12, 2026 shows that the company’s core business maintained steady growth. Specifically,

[1], which is flat with the growth rate in Q3 2024, demonstrating strong growth resilience.

From the perspective of business segment breakdown:

Business Segment	Q4 Retail Growth	Quarter-over-Quarter Change	Business Momentum
361° Core Brand	+10%	Flat	Steady Growth
361° Kids Brand	+10%	Slightly Slowed	Maintained Double-Digit Growth
E-Commerce Platform	High Double-Digits	Slightly Slowed	High-Speed Growth

In terms of channel construction, as of December 31, 2025, the total number of the company’s premium stores in mainland China reached

, and its first overseas premium store grandly opened in Cambodia, marking a new step in the brand’s overseas market expansion[1]. The total number of global stores reached , representing a 1.73% year-on-year increase, with overseas stores growing 8.33% to 1365.

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361 Degrees announced on its Brand Day on December 26, 2025 that it

to start a new cycle of strategic cooperation, marking the continuation of the company’s in-depth binding with top international sports events[1]. Through continuous sponsorship of major events, the company has effectively enhanced its brand awareness and image. In addition, the company has reached in-depth strategic cooperation with Kanglun Aerospace and Tianjin University of Sport, integrating aerospace technology and sports research resources to further strengthen the brand’s professional attributes.

In Q4, the company launched a number of new products with market competitiveness, including:

• Winter down products such as “ULTRA Series Jirui Down Jackets”
• Nikola Jokić’s first signature basketball shoe “JOKER1”
• 361° Yuping Jackets, Supai FLOAT2 running shoes, etc.
• The second-generation Mass Balance low-carbon eco-friendly running shoe “Feiran 5” jointly released with Evonik

The launch of these new products has effectively enriched the product portfolio to meet the diverse needs of consumers[1].

The e-commerce platform recorded

GMV growth, with its growth rate continuing to lead all business segments. In 2025, the company accelerated the layout of its instant retail strategy, with , launching a new instant retail strategy. The strong performance of the e-commerce channel reflects the remarkable results of the company’s digital transformation.

The company continues to advance channel upgrading, with the 10th-generation store image being rolled out continuously. In 2024, the average store area reached 149 square meters, representing a 7.97% year-on-year increase, and the proportion of stores in shopping malls and department stores increased, continuously improving channel quality[2].

In 2025, the sportswear industry as a whole showed a pattern of “volume growth at the expense of price”. According to industry data, sales of sportswear increased by 3.8% year-on-year, but the average price decreased by 2.8%, reflecting demand pressure and intensified competition[3]. Such a consumption environment poses certain challenges to mid-market positioned brands like 361 Degrees.

In 2024, China’s sportswear market recorded only

year-on-year growth, a significant slowdown from the previous high-growth period[4]. Against the backdrop of overall industry growth deceleration, competition among brands will shift from incremental market to stock market competition.

The average price of various categories across brands has generally declined, reflecting weak demand and intensified competition. 361 Degrees has continued to face price pressure given its high proportion of professional product portfolio[3]. How to maintain growth while preserving profitability is an important issue for the company.

Based on comprehensive analysis, we believe that 361 Degrees’ 10% retail sales growth

, but its upside potential is limited:

• Short-term (H1 2026)
  : Benefiting from the Spring Festival consumption peak and sports event marketing, growth is expected to be maintained
• Mid-term (Full-year 2026)
  : Need to monitor the progress of macroeconomic recovery and consumer confidence restoration
• Long-term (2027 and beyond)
  : Brand upgrading and product innovation will be the key determinants of growth sustainability

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According to industry research data, China’s sportswear industry shows a clear echelon differentiation pattern[5]:

Echelon	Enterprise	2024 Apparel Business Revenue	Market Position
First Echelon	Anta Sports	RMB 39.385 billion	Absolute Leader
Second Echelon	Li Ning, Xtep International, 361 Degrees	RMB 10-20 billion	Challenger
Third Echelon	Toread, Jialinjie, etc.	< RMB 5 billion	Regional/Niche Market Player

Anta Sports firmly ranks as the industry leader with an absolute scale advantage, and its 2024 revenue scale is approximately 1.4 times the total of the other three companies[4]. 361 Degrees is in the second echelon of the industry, directly competing with Xtep International.

: Nike’s market share dropped from approximately 22.5% in 2019 to around 12.5% in 2024, and Adidas’ share also shrank[5]. This change provides a window of opportunity for domestic brands to expand their market share.

: Anta’s market share increased from 15.3% in 2019 to in 2024, and Li Ning’s market share also increased. 361 Degrees’ market share , but the growth rate is relatively limited[5].

: From 2019 to 2024, CR3 decreased from 58.3% to 53.1%, while CR10 remained around 82.5%, indicating that although the market pattern has changed, it remains stable overall[5].

:

1. Solid Brand Heritage
   : Founded in 2003, the company has been deeply rooted in the industry for over 20 years, continuously enhancing its brand image through initiatives such as becoming an Olympic partner, and was selected as one of the Top 10 Sportswear Brands in the 2025 CNPP Ranking[5].
2. Advantage in Running Niche
   : The company focuses on its core running business, with a professional racing running shoe portfolio including “Feiran” and “Feibiao”, and has a certain brand recognition in the running niche market[2].
3. Strong Growth in Kids’ Business
   : The 361° Kids brand maintains double-digit growth, becoming the company’s second growth curve.
4. Sound Financials
   : With a current ratio of 3.77, significantly higher than the industry average, the company has low financial risk[0].
5. Attractive Valuation
   : The current P/E ratio is only
   8.76x
   , significantly lower than that of Anta (13.56x) and Li Ning (16.15x)[0].

:

1. Obvious Scale Gap
   : With a market capitalization of only US$1.191 billion, less than 6% of Anta’s, the scale disadvantage limits the company’s brand investment and channel expansion capabilities.
2. Limited Brand Premium Capability
   : The gross margin is approximately 41%, lower than Anta’s 65% and Li Ning’s 50%, reflecting a gap in brand premium capability[0].
3. Slow Market Share Growth
   : Although maintaining growth, the magnitude of share increase is limited, and the company faces pressure amid intensified competition from head brands.

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Financial Indicator	361 Degrees	Anta Sports	Li Ning	Industry Evaluation
Market Capitalization (USD 100 million)	11.91	220.81	50.70	Small Scale
P/E Ratio (x)	8.76	13.56	16.15	Undervalued
ROE (%)	12.53	23.75	10.51	Above-Medium
Net Profit Margin (%)	11.44	19.71	9.60	Medium Level
Gross Margin (%)	~41	65	50	Medium Level
Current Ratio	3.77	1.63	2.88	Sound Financials

From the financial data, 361 Degrees exhibits the characteristics of

. The company’s current P/E ratio is only 8.76x, significantly lower than the average valuation of comparable peers, providing a relatively high valuation safety margin[0].

:

• ROE Level
  : The ROE of 12.53% is at the upper-mid level in the industry, higher than Li Ning’s 10.51%
• Net Profit Margin
  : A net profit margin of 11.44% reflects relatively robust profitability of the company
• Asset Turnover Rate
  : The company’s asset turnover efficiency is at a normal level in the industry
• Financial Leverage
  : Low financial leverage (current ratio of 3.77) indicates a conservative operating style of the company

:

Financial analysis shows that the company exhibits

(low depreciation/capital expenditure ratio), but has a [0]. Overall, the company’s profit quality is medium, but its financial safety is high.

:

According to the forecast from Huayuan Securities Research Institute, 361 Degrees’ net profit attributable to shareholders is expected to grow by 14.50%, 12.75%, and 12.63% in 2025-2027 respectively[2]. Based on the current share price of HK$5.76, the corresponding forecast P/E ratio for 2025 is approximately

, lower than the average valuation of comparable peers.

:

Company	P/E (TTM)	Relative Valuation
361 Degrees	8.76x	Benchmark
Anta Sports	13.56x	+55%
Li Ning	16.15x	+84%
Xtep International	~10.5x	+20%

361 Degrees’ valuation is significantly lower than that of its industry peers, mainly due to:

1. Smaller scale, resulting in a liquidity discount from the market
2. Relatively weaker brand premium capability
3. Relatively conservative growth expectations

:

• Unexpected increase in market share
• Sustained high-speed growth of kids’ or e-commerce business
• Improvement in gross margin driven by product innovation breakthroughs
• Scale expansion through mergers and acquisitions or strategic cooperation

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The current P/E ratio is only 8.76x, significantly lower than the historical average and comparable peers, with a price-to-book ratio of only 1.06x, close to net asset value[0]. From a valuation perspective, downside risk is limited while upside potential is considerable.

The company’s core business maintains steady growth, with the kids’ and e-commerce businesses as two high-growth engines continuing to gain traction. According to profit forecasts, net profit attributable to shareholders is expected to grow by 18.1%, 14.3%, and 12.4% in 2024-2026 respectively, with relatively high certainty of performance growth[1].

The company has maintained stable dividends in recent years, coupled with a

share price increase over the past year, providing attractive shareholder returns[0].

Southbound capital continues to flow into the Hong Kong stock market, with high-quality consumer leaders attracting capital attention. As a niche leader in the sportswear sector, 361 Degrees is expected to benefit from adjustments in capital allocation.

Slower-than-expected recovery of consumer demand may affect the company’s performance growth. If the macroeconomy continues to be under pressure, sportswear consumption may weaken further.

Head brands Anta and Li Ning continue to increase investment, while Nike and Adidas launch price counterattacks in the Chinese market. Industry competition may intensify further, squeezing 361 Degrees’ market share and profit margin.

The company plans to improve channel quality through initiatives such as opening premium stores. If the store opening progress falls short of expectations, it may affect performance growth[2].

As a sports brand, the company’s brand image and celebrity endorsers’ reputation have an important impact on its business. In the event of brand image damage, it may have a negative impact on the company.

The overall valuation of the Hong Kong stock market is greatly affected by external factors. If market risk appetite declines, the company’s valuation may come under pressure.

: (Maintained)

: Based on 7-8x P/E ratio for 2025, the reasonable target price range is [1]. Considering the continuous improvement of the company’s fundamentals and valuation restoration potential, there is still upside potential for the share price.

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1. Growth Sustainability
   : 361 Degrees’ 10% retail sales growth
   has certain sustainability
   , but its upside is limited by the macroeconomy and industry competition. The kids’ and e-commerce businesses will be the main growth engines.
2. Competitive Strategy
   : The company’s differentiated development strategy focusing on the running niche and kids’ business is clear, consolidating growth foundations through brand upgrading and channel innovation. However, it faces pressure in market share growth amid intensified competition from head brands.
3. Investment Value
   : With ample valuation safety margin (8.76x P/E ratio), sound financials, and relatively high certainty of performance growth, the company has favorable investment value.

Investment Dimension	Evaluation	Suggestion
Valuation Level	Undervalued (8.76x P/E)	Buy on Dips
Growth Certainty	Medium-High (10%+ growth)	Hold Primarily
Risk-Reward Ratio	Favorable	Active Attention
Positioning Suggestion	Sportswear Allocation	5-10% Position

:

• Position-Building Range
  : HK$5.0-5.5 (corresponding to 8.7-9.5x P/E ratio)
• Target Price
  : HK$6.0 (corresponding to approximately 10x P/E ratio)
• Stop-Loss Price
  : HK$4.5 (corresponding to approximately 8x P/E ratio)

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[0] Jinling API Financial Database - Company Profiles and Financial Data of 361 Degrees, Anta Sports, Li Ning (January 12, 2026)

[1] Zhitong Finance - “361 Degrees (01361): Retail Sales of Core Brand Products Recorded Approximately 10% Year-on-Year Growth in the Fourth Quarter” (January 12, 2026) (https://cn.investing.com/news/stock-market-news/article-3160069)

[2] Huayuan Securities - “Initiation Coverage Report on 361 Degrees (01361.HK): Product R&D Enhances Brand Professional Attributes, Channel Innovation Consolidates Company Performance Growth” (July 2025) (https://pdf.dfcfw.com/pdf/H3_AP202507011701058424_1.pdf)

[3] Guosen Securities - “Sportswear Industry Special Topic: Review and Analysis of Q2 2025 Product Competition” (July 2025) (https://www.fxbaogao.com/detail/4971635)

[4] 21st Century Business Herald - “Anta and Li Ning Launch a New Round of ‘Capacity Building Battle’” (September 18, 2025) (https://www.21jingji.com/article/20250918/herald/3466c6eebed147658c28bc73170482f3.html)

[5] Qianzhan Industry Research Institute - “Insight 2025: Competition Pattern of China’s Sportswear Industry” (June 27, 2025) (https://bg.qianzhan.com/trends/detail/506/250627-a5a6e92f.html)

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Report Generation Date: January 12, 2026
Analyst: Jinling AI Financial Research Department