China consumption remains weak, and Nomura maintains a preference for selective consumer stocks

Overview

This report focuses on Chinese consumption-related sectors, with the key backdrop being a slowdown in China’s June CPI growth and a continuation of weakness in consumption demand. Nomura argues that in an overall environment of subdued consumer sentiment, recent retail policy signals provide medium- to long-term support, while short-term positioning should still focus on companies with clear growth strategies, visible margin trajectories, and attractive valuations.

Core views

The core views of the report are: first, China’s CPI remains weak and consumption recovery is insufficient; second, policies to promote innovation in retail help improve resource allocation, financing, and competitive conditions in physical retail; third, after the sector’s recent stock pullback, selective high-quality consumption names offer a more attractive risk-return profile; fourth, Nomura remains constructive on ANTA Sports Products in sportswear and Laopu Gold in retail.

Analysis framework

The report combines macro consumption data, policy interpretation, and relative valuation coverage of the covered companies. It first assesses sector backdrop through CPI and consumer sentiment, then reviews retail-support policies from MOFCOM and related departments, and finally evaluates investment appeal through P/E multiples, target prices, and company-specific risks.

Methodology notes

• Valuation MethodP/E Multiple Valuation

  Target price is derived from forecast P/E and target multiple.

  ANTA target price HKD125 is based on 25x F12M P/E, approximately equal to its five-year average forward P/E; Laopu Gold target price HKD1,114 is based on 22.5x FY26F P/E, reflecting its higher sales and profit-growth trajectory.

• Rating FrameworkNomura Equity Rating Framework

  Buy means the analyst expects the stock to outperform the benchmark over the next 12 months.

  The report states that Nomura’s Buy, Neutral, and Reduce ratings represent relative 12-month expected performance versus benchmark, and target prices reflect the analyst’s assessment of current intrinsic fair value.

Asset mapping & comparison

Structured mapping from thesis to named assets (strengths, weaknesses, peers, risks).

• ANTA Sports Products (2020 HK)

  Core recommended consumption name

  Strengths

  Sportswear leader with a relatively clear development strategy and valuation in a range the report considers attractive.

  Weaknesses

  Affected by weak macro consumption conditions and industry competition.

  Comparison

  Target price is based on 25x F12M P/E, roughly equal to the five-year average forward P/E, and benchmarked against the Hang Seng Index.

  Risks

  Intensifying domestic and international competition, sales growth below expectations, and weaker-than-expected macro environment.

• Laopu Gold (6181 HK)

  Core recommended retail name

  Strengths

  The report believes risk-reward is currently attractive, especially when spot gold is stable and geopolitical conditions are more relaxed.

  Weaknesses

  Sensitive to gold prices, fashion-cycle risk, and the consumption backdrop.

  Comparison

  Target price is based on 22.5x FY26F P/E, reflecting a stronger sales and profit growth trajectory, and benchmarked against the Hang Seng Index.

  Risks

  Material declines in gold prices, higher-than-expected fashion risk, and weaker-than-expected macro conditions.

Key data

• ANTA Sports Products Current PriceHKD71.75 (2026-07-09)Stock rating is Buy, target price HKD125.
• ANTA Sports Products Valuation14.0x FY26F P/ENomura remains positive on this sportswear name.
• Laopu Gold Current PriceHKD383.00 (2026-07-09)Stock rating is Buy, target price HKD1,114.
• Laopu Gold Valuation7.7x FY26F P/EThe report says risk-reward is attractive when spot gold is stable and the geopolitical backdrop is more benign.
• Nomura Rating DistributionBuy 58%, Neutral 39%, Reduce 3%From Nomura Group global equity research disclosures.

Impact & implications

For investors, the report indicates that the China consumption sector still faces demand and macro pressure in the short term, so it should not be treated as an across-the-board buy on policy support alone. A more selective approach based on earnings visibility, valuation margin of safety, and company execution capability is more appropriate. Retail support policies may improve the industry competitive environment over the medium to long term, but stock performance will still depend on sales growth, margin trends, gold prices, and the macro backdrop.

Risks

• China’s consumer sentiment remains soft, weighing on retail and discretionary sales.
• ANTA faces risks from intensified domestic and international competition, sales growth below expectations, and weaker macro conditions.
• Laopu Gold faces risks of significant gold price declines, fashion risk, and weakening macro conditions.
• There is a lag and implementation uncertainty between policy support announcements and actual earnings improvement.

What to watch

• Whether subsequent China CPI, retail sales, and consumer confidence data improve.
• The progress of implementation of retail innovation policies in land, financing, taxes, and listing support.
• ANTA’s sales growth, margin trend, and changes in competitive dynamics.
• Laopu Gold’s same-store sales, gold price trend, and brand fashion risk.
• How quickly sector valuations recover after the recent stock weakness.