Warning: Why Are Short Selling Agencies Eyeing The Listed Companies Of Hong Kong Shoes And Footwear?

For high quality listed companies, short sellers are abominable, but they can also be regarded as a good chance for physical examination. But for listed companies with problems, the short selling report is the beginning of the fig leaf.

In the Hong Kong stock market, shoes and clothing listed companies are frequent customers of short selling agencies, and Chinese sporting goods companies are the focus of their blocking. Whether it was not long ago, Bosideng or this time Anta was short of the international short selling agency.

In June 2018, the short selling organization GMTResearch even issued a short selling report on up to 16 mainland sporting goods enterprises, accusing Hongxing sports, flying international, China sports, and the other 9 enterprises as "Swindlers Company". Anta, Lining, 31st degree, trend group and other 7 enterprises were suspected of financial fraud. Anta, XTEP and 31st three shares were named, and the stock market value in three days evaporated 19 billion 122 million Hong Kong dollars.

The international short selling agency has not yet seen the blockade of the Chinese footwear enterprises in Hong Kong stock market. As a blocking object, Chinese shoes and clothing enterprises are time to check their own vacancies and improve the level of guarding against capital market risks.

From the objective environment, shorting is a real value discovery mechanism in mature capital market. When stock price bubbles occur, shorting can inhibit bubble risk to a certain extent. What we need to guard against is malicious short selling, that is, by spreading false rumors to cause market price fluctuations to gain profits.

At present, short selling is already an important source of liquidity in the Hong Kong stock market. The HKEx has not strictly restricted the contents of the letter, but many listed companies will disclose the transaction content to the minimum and provide gaps for the short agency allegations.

From the perspective of enterprises themselves, on the one hand, most of the listed companies of Chinese shoes and clothing companies involve many links such as design, manufacture and sales. This helps enterprises control industrial chain and react quickly to market demand. Under this mode, companies can easily adjust profits to make financial statements more attractive. For example, increasing sales volume through distributors is a common operation method in the market, but such operations are easy to be ignored by agencies.

At present, the short selling agencies are concerned about the famous white horse stocks in the market. Whether they buy Anta from FILA or Bosideng as a high-end down jacket, the more optimistic the stock market is, the shorter the profit will be.

On the other hand, if we want to avoid being the target of short selling organizations, we need to enhance the strength and influence of the brand itself.

China's footwear and clothing companies, especially sporting goods companies, have significantly less investment in product R & D, compared with those giants such as Adidas and Nike.

The Anta sports science laboratory, which boasts a large footprint database and has more than 600 patents, is currently the only state-level Sports Science Laboratory in the industry. The proportion of Anta R & D investment is also rising, reaching the highest 5.7% in 2017. It dropped to 5.2% in 2018, but it is still the highest in China.

Even so, compared with decades old Nike and Adidas R & D laboratories, the accumulated mass movement data are not the same, and the latter's R & D investment is continuing to increase, and the head office of Chinese sporting goods, such as Anta and Lining, has only paid attention to R & D and increased investment in recent years.

The domestic sports industry is entering a period of rapid growth. The sporting goods industry is expected to usher in a new round of growth. Consumption will be relatively active. Chinese sports shoes and clothing companies will constantly standardize and strengthen themselves in order to better control the interests and risks of the capital market.