Bosideng to diversify through acquisitions
Bosideng International Holdings, the mainland down-coat maker listing in Hong Kong, aims to diversify by buying brands in other clothing lines and sell them in its 6,800 mainland outlets, according to chairman Gao Dekang.
Jiangsu-based Bosideng plans to raise up to HK$6.52 billion by selling 1.988 billion shares at between HK$2.56 and HK$3.28 each in its initial public offering next month. Goldman Sachs and Morgan Stanley are arranging the sale.
The international tranche of the offering was 10 times oversubscribed, according to sources. The retail tranche, which starts today, will run until Wednesday. Pricing will be fixed on October 10 and trading will start on October 11.
The Li Ka Shing Foundation, China Life Insurance, the Lee Shau-kee-controlled Cenwise Investment, Cheng Yu-tung's Chow Tai Fook Nominee and Dickson Poon's Equity Advantage are Bosideng International's corporate investors.
The company's self-branded down apparel accounted for 88.4 per cent of total sales in the year to March.
The rest came from down products made for other companies.
Because of a warm winter last year, the company's inventory balance jumped 135 per cent to 1.23 billion yuan in March, compared with 528.9 million yuan a year ago.
Chief financial officer Claudia Lo Ka-wai said the firm had made its products more fashionable and did not expect much impact from the inventory rise.
The company, which increased net profit 23.3 per cent to 617.59 million yuan in the year to March, forecast net income would be at least 950 million yuan this year.
Ms Lo, the former financial controller of milk producer China Mengniu Dairy, said Bosideng's earnings this year would be boosted by higher sales and gross profit margins driven by an increase in average selling prices.
