Li Ning is a Chinese gymnast and entrepreneur. In 1982, he won six of the seven medals awarded at the Sixth World Cup Gymnastic Competition, earning him the title "Prince of Gymnastics", and is most famous for winning 6 medals at the 1984 Summer Olympics, the first Olympics in which China participated. Li retired from sporting competition in 1988, and in 1990 he founded Li-Ning Company Ltd, which sells footwear and sporting apparel in China. Li remains chairman of the company's board of directors.
Speedier Li Ning revamp boosts hopes and shares
Stock hits four-month high after chairman's upbeat views, but analyst sees a tough market
Shares of sportswear retailer Li Ning surged to a four-month high yesterday after the company said it would complete its restructuring plan earlier than expected. The retailer said there would be no large-scale shop closures.
Yet an analyst said there had been no substantial improvement in the company's business and the recovery of the sportswear industry would be slow.
Shares of Li Ning shot up by as much as 18 per cent yesterday as the company's chairman Li Ning said after the annual general meeting that the transformation process might be shorter than the originally planned two to three years.
The company has since been restructuring distribution channels and establishing a retailing-driven business model.
Executive vice-chairman Kim Jin-goon said that inventory levels were expected to decrease to a normal level in the second half of this year, and the sales performance and discount levels had both improved over the past three quarters.
Li said the company had no fundraising plan for the moment.
The stock of the Beijing-based company closed at HK$5.29 yesterday, a rise of 15.8 per cent, compared with a 0.4 per cent drop in the benchmark Hang Seng Index.
Jerry Peng, an analyst at Guotai Junan International, believed the share price gain was a short-term rebound and expected the retailer was very likely to record a loss again this year.
"The sportswear market has been quite weak in the first half. The tough time for the retailers is not over yet," said Peng. "We expect the market may get better next year, though there are still many uncertainties."
Li Ning, which competes against global sportswear giants Nike and Adidas and local player Anta, reported a bigger-than-expected loss of 1.98 billion yuan (HK$2.48 billion) last year.
The company's shares have lost nearly 90 per cent from their peak in the first half of 2010.
The company introduced private equity fund TPG as a stakeholder in January last year.
TPG partner Kim Jin-goon has taken a leading role along with founder Li Ning in daily operations since Zhang Zhiyong resigned as chief executive in July last year.
Li said the sportswear industry in China was still on a fast-growing path, though the period of aggressive expansion was over.