Lining Team Reacts Executives Away

For two executives running away in two weeks, Li Ning Co's explanation is "normal changes in organizational structure and management", but the industry generally believes that frequent personnel changes at high levels are related to the failure of Lining's brand remodeling.

At the end of June last year, Li Ning Co launched a series of brand reinventing plans, such as changing labels and changing slogans.

However, over the past year and a half, Lining's orders declined due to a large number of old products, such as backlog of stock, the failure to straighten out the channels, and the market's failure to recognize the new standard.

In the first half of this year, net profit of Li Ning Co decreased by 50% compared to the same period last year.

"As chief product officer, we must be responsible for the continued decline of new product orders," an industry insider who did not want to be named pointed out that the resignation of two executives in two weeks indicates that Lining began paying debts for the brand remolding plan.

In the capital market, because of frequent profit warning, Lining shares were sold by investors, and the share price fell into a long decline.

Lining's share price dropped from HK $14 to HK $7 in July. Less than 5 months later, the share price was cut off.

In the eyes of international investment banks, Lining's current predicament is the epitome of the whole sports apparel industry. "With the aging of the industry, some of the smaller and less cash businesses will be eliminated, but the large sportswear dealers can get through this crisis."

Goldman Sachs pointed out that Lining, the first to go inventory, is expected to take the lead in "recovery".