Hong Kong-listed Chinese down jacket maker Bosideng boosted by younger consumers, posts 42 per cent jump in first-half profit
- Hong Kong-listed Bosideng International reports rise in earnings for six-month period ended September 30
- The market in China for down jackets could hit 138 billion yuan this year
Wang Lu, a high-school student, is anticipating freezing temperatures during the coming winter, and recently decided to buy herself a new jacket made of down.
“It is going to be the coldest winter in 60 years [according to forecasts]. Hopefully, I can survive the chilly weather with a decent down jacket,” the Shanghai native said. She plans to use the 2,000 yuan (US$304) her parents gave her to buy an “upmarket jacket” by a domestic brand.
Down jackets and coats are not very common in China, with only about 10 per cent of its population owning such garments, according to Shenzhen-based market research firm Qianzhan Industry Research Institute. But their popularity is rising among the country’s fashion-conscious youth.
The company’s efforts to move up the value chain paid off, chief financial officer Zhu Gaofeng said during an earnings briefing. “As we moved upmarket with launches of fashionable and professional down jackets, product prices shot up and boosted our profit margin,” he said. Bosideng’s gross profit margin had increased 4.3 percentage points to 47.8 per cent at the end of September.
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The market for down jackets topped 120 billion yuan in 2019, up 10 per cent from 2018, according to Qianzhan. Earlier this year, it forecast that this market could hit 138 billion yuan nationwide in 2020, reflecting a year-on-year rise of 14 per cent.