Expanding product categories during the off-season, BOSIDENG doesn't want to only sell winter clothing.
BOSIDENG has released its mid-term financial results for the 23/24 fiscal year, with sales of down jackets reaching a new high for the same period in history, and the sun protection clothing category experiencing a five-fold year-on-year growth. BOSIDENG plans to expand its product line, not only selling winter clothing but also doing business throughout all four seasons. At the same time, the sales volume of BOSIDENG's lightweight down jackets and windbreakers is expected to reach 400,000 to 500,000 units. Other luxury brands such as Moncler and Canada Goose are also expanding their product lines, but Canada Goose's stock price has fallen due to slow progress in its product categories. In this regard, the domestic brand BOSIDENG is leading its competitors.
Building widespread consumer awareness in a niche clothing category is not easy. For example, Lululemon with yoga pants, and BOSIDENG (3998.HK) with down jackets.
With the global climate getting warmer, BOSIDENG's sense of urgency is reflected in its expansion from down jackets to more categories, aiming to do business all year round instead of just one season.
Recently, BOSIDENG released its mid-term financial results for the 23/24 fiscal year. In the six months ending September 30th of this year, BOSIDENG recorded a revenue of approximately 7.472 billion yuan from down jackets, a year-on-year increase of 20.9%; net profit increased by 25.1% to 919 million yuan, setting a new historical high for the same period in the off-season of down jacket sales.
At the performance communication meeting on November 28th, Rui Jinsong, Senior Vice President and General Manager of BOSIDENG Business Unit, told TradeWind01 and others that this year BOSIDENG's sun protection clothing category has grown five times compared to the previous year. In the Chinese market where there is no obvious leading brand in the sun protection clothing category, BOSIDENG and Uniqlo's sun protection clothing are "very leading".
However, due to the slightly lower gross profit margin of BOSIDENG's sun protection clothing compared to down jackets, and the faster growth rate of the sun protection clothing category during the reporting period, the gross profit margin of BOSIDENG's down jackets (including sun protection clothing) decreased by 2.4 percentage points to 61.2%.
According to information obtained from insiders close to BOSIDENG by TradeWind01, it is expected that the revenue of BOSIDENG's sun protection clothing category will exceed 500 million yuan in the next two years.
At the performance communication meeting, the management also specifically mentioned BOSIDENG's lightweight down jackets and windbreakers in the context of warmer weather. The latter has been selling well since its launch on August 15th, and it is expected to achieve sales of around 400,000 to 500,000 units for the whole year.
International luxury brands, Moncler and Canada Goose, are also expanding their product categories in a similar manner. Moncler is focusing on fashion by acquiring Stone Island and frequently engaging in collaborations, while Canada Goose, due to its strong brand image in extreme cold weather, has been slow in expanding beyond parkas. Its stock price fell more than 10% after its performance in the third quarter of the 2024 fiscal year fell short of expectations.
In this regard, BOSIDENG, a domestic brand that has been making great strides in recent years, seems to be leading the way. The day after the financial report was released, on November 28th, BOSIDENG rose 5.19% to close at HKD 3.24 per share.