Topsports: May-Q Sales Weak; Nike China News Could Pressure Both Sides, If It Materializes

Research evidence excerpt

Topsports: May-Q Sales Weak; Nike China News Could Pressure Both Sides, If It Materializes

Update

June 25, 2026 04:35 PM GMT

Morgan Stanley Asia Limited+MTopsports | Asia Pacific Dustin Wei

Equity Analyst

May-Q Sales Weak; Nike China Dustin.Wei@morganstanley.comJenny Yu +852 2239-7823

Research Associate

Jenny.Yu1@morganstanley.com +852 3963-1925

News Could Pressure Both Lillian Lou

Lillian.Lou@morganstanley.com +852 2848-6502

Sides, If It Materializes

Nike has been prioritizing full-price sales in China, where

excessive online promotions and pricing inconsistency have

persisted for years. Supply reduction and distributor

Topsports International Holdings Ltd (6110.HK, 6110

consolidation should help, but cutting major distributors’ online HK)

operations would be disruptive to the ecosystem. China/Hong Kong Consumer | China

Stock Rating Overweight

Topsports’ recent share price weakness (down 23% in the past 5 days vs. HSCEI Industry View In-Line

down 6%) was driven by market concerns that Nike China may stop major Price target HK$3.60

Up/downside to price target (%) 76

distributors from selling Nike products online in an effort to address excessive Shr price, close (Jun 24, 2026) HK$2.05

promotions and pricing inconsistency in the online marketplace. Topsports clarified 52-Week Range HK$3.50-2.04

Sh out, dil, curr (mn) 6,201

today that it has not received any official notice from Nike regarding the termination Mkt cap, curr (mn) US$1,622

EV, curr (mn) US$1,600

of its online distributorship in China. Nike online sales accounted for 22% of

Avg daily trading value (mn) US$5

Topsports’ FY26 revenue.

Fiscal Year Ending 02/26 02/27e 02/28e 02/29e

We think Nike’s intention to clean up online pricing is in line with its effort at pricing EPS (Rmb)** 0.20 0.20 0.22 0.25