Lyon: LI NING (02331) reported a net profit far exceeding expectations for the second half of last year, with a "hold" rating.

Lyon issued a research report stating that LI NING (02331) saw a 3% increase in sales and a 13% increase in net profit in the second half of last year compared to the previous year, exceeding market expectations by 4% and 28% respectively. If government subsidies are not taken into account, net profit is expected to rise by 17% in the second half of 2025. The sales growth is mainly attributed to an 8% increase in wholesale sales (market expectations were a 3% increase). As for the full year of 2025, both sales and net profit outperformed expectations. The bank maintains its rating as "hold." The bank points out that since the second half of 2022, the second half of 2025 is the first half fiscal year report to record a recovery in net profit growth compared to the previous year, but it is crucial for the company to provide guidance for 2026. In terms of net profit margin expansion, the bank expects that management will not adopt overly aggressive strategies.