Goldman Sachs Sees Divergent Outlook for China Sportswear, Names Anta as Top Pick

Chinese sportswear companies delivered first-half 2026 earnings that surpassed cautious market expectations, but their guidance for the second half of the year shows a growing divergence, according to a new research report from Goldman Sachs. The bank maintains its preference for Anta Sports (02020.HK) amid a complex consumer environment.

The analysis follows the latest earnings releases and meetings Goldman Sachs held with the management of Anta, Li Ning, Xtep, Pou Sheng International, and Asics between August 31 and September 2.

H1 Beats, H2 Outlook Varies

While the sector's first-half results were generally better than feared, forward-looking guidance from major brands was inconsistent, signaling varied confidence in the months ahead.

• Anta Sports (02020.HK): Core net profit beat expectations, and the company maintained its full-year guidance.
• Li Ning (02331.HK): Net profit came in ahead of market consensus.
• Xtep International (01368.HK): Though net profit was slightly better than expected, the company lowered its full-year sales guidance.

This divergence highlights the increasingly challenging environment, where stronger players are solidifying their positions while others face headwinds.

Shifting Market Dynamics

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Goldman Sachs anticipates that demand for sportswear in China will continue to grow in the second half but will be volatile. The bank identified several key trends shaping the industry:

• Polarizing Growth: The market is becoming increasingly stratified, with premium and professional brands outperforming the broader sector as consumer preferences shift.
• Channel Evolution: Online sales continue to outpace offline channels. In physical retail, foot traffic is migrating from traditional street-front stores to shopping malls and outlet centers, prompting brands to optimize their store portfolios.
• Discounting Pressure: Price competition is expected to remain a key feature. Goldman noted that inventory clearance by international brands like Nike could intensify promotional activity in the short term, particularly around major shopping events like the "Singles' Day" festival.

Analyst View

Goldman Sachs forecasts mid-single-digit growth for China's sportswear consumption annually from 2026 to 2028. Within the sector, the bank reiterated its preference for brands over original equipment manufacturers (OEMs) and distributors.

The firm maintained a "Buy" rating on Anta Sports, citing its successful multi-brand strategy, differentiated category positioning, and strong operational execution. However, the report also noted that Li Ning could benefit from near-term catalysts, including a promotional tour by NBA star Stephen Curry and brand exposure during the Asian Games.