SaloCascarino|AssociateDirector-ConsumerGoods-EMEASectorUpdateArlannaValezano,CFA]SeniorAnalyst-ConsumerGoods-EMEARoccoSemerano|DirectorLeadAnalystSportswear-ConsumerGoods-EMEARaamRatnam|ManagingDirector,Robust growth prospects amid intensifying competitionSectorLead-Consumer&Retal-EMEAS&PGlobalJune25,2024Ratingsoroiingoction
ContentsmoIndustrv overview and kev takeawaysSelectedratedentitiesinsportsweanSelected rated entities' business and financial724Recent rating actions andoublicationgS&PGlobalRatingscontacts2S&P GlobalRatings
Industrv Overview AndKey TakeawaysS&P GlobalRatings
KeyTakeawaysThe sportswe ar industry has solid growth prospects. Demand is underpinned by the incre asing number of wommen in sports, thecasualization ofdress codes, and continued penetratian in APACShort-termchallenesin2024,relate tohow quicklyconsumer confidenecerecovers.Competitive pressuresvwillremain high;.frm localWe exoect volumes and praductinnovation willdrive @rowth in 2024. with amoderate orice contribution asinflationeases.Asteouninmarketineexpensestosupoortpreviouspricehikesandpromotenewproducts could weigh on profitabilitv exoansion.As inventorvlevelsgraduallynormalize, we expect a more subdued promational erviranmentThe sportswearindustrylocatedinAPAC.GeopoliticaltensionsSa createdtemporayproductavalablityout most large brands have been able to na vigate these challengesThe direct-to-consumer channel(including e-commerce) remains a key focus, ensuring brand visibility and praximity to consumers, howeverbase and manag ing high volumesSportswear companies' strategies around environmental and social topics are central to preserving their license to operate andprotectingbrandreputation.iiing focus on sustainable products, le d by ec o-friendly materials, while maintaining corecampetenciesbasedantheperformancebenefitsofsportsapparelandfootweaS&P GlobalRatings
IndustrvGrowthProspectsISolidGrowthProiectedToContinue·Asof 2023. the valueof the elobal sportswear industry is close to US$395 billion at retail value selling price,growing with a CAGR ofabout 4.5% over 2009-2023 Sportswear has recovered quickly following the pandermic; retail value in 202 1 had already exceeded 2019levels.·Soortswear should excand bv about6%-7% compound annual growthrate (CAGR)over 2024-2028, by retail value at currentprices(Furomonitor). But weestimate rated entities such as Nike. Adidas. and VF will erow by the low-to-mid single digitsin 2024-2025,duetohigh competition and soft demand as consumers focus spending on staples. services. and tr avelinstead of discretionarvapparelandfootwear.Historical and oroiected develooment of totalgortswearsalesby retail value600COVID-19 andpast-pandemicrebound50028oProjectedgrawth(%)42MO18AO人400（$1阳）-Annualgrawthfrightscale)200a-30S&P GlobalRatings
Competitive Landscape|LocalAnd Niche BrandsAreGainingMarketShares Despite incre asing competitionfrom more agile, local players or brands with a focus on niche sports such as lululemon, Hoka, and On Running.Nikecontinues to increaseits market share tha...
