Xtep is building its overseas market for running shoes and plans to achieve a 50% growth in related business each year over the next three years.
<h4>Key Points:</h4>
<ul>
<li>Xtep has entered Malaysia with the opening of six new stores, forming a layout with previously opened stores in Singapore and Indonesia.</li>
<li>The sportswear manufacturer is actively expanding into the Southeast Asian market, aiming to increase overseas revenue by 50% annually over the next three years.</li>
</ul>
Tan Ying
China's running boom has begun to cool after a previous rapid rise. According to data from the Chinese Athletics Association (CAA), the number of marathon events in 2025 is expected to decrease from 696 the previous year to 594. However, as the Chinese market cools, the running craze in Southeast Asia is just starting, with large events quickly emerging. For example, last year's Standard Chartered Kuala Lumpur Marathon attracted 42,000 runners.
This market change has prompted the sports shoe manufacturer Xtep International Holdings Limited (1368.HK) to accelerate its layout in Southeast Asia. The company announced last week the opening of its first six stores in Malaysia, following the opening of stores in Jakarta, Indonesia, in January this year and in Singapore in November last year. As the business gradually moves beyond the Chinese market, Xtep aims to achieve a 50% annual growth in overseas revenue from 200 million yuan (approximately 29.3 million USD) in 2025.
&#34;These six (Malaysia) stores are just the starting point,&#34; the company stated. &#34;Xtep plans to significantly expand its retail network and establish a complete running ecosystem in Malaysia and throughout Southeast Asia.&#34; In addition to Malaysia, Xtep has opened three stores in Indonesia this year and plans to continue expanding in Southeast Asia by 2026.
In terms of store numbers, Xtep is still far behind local competitor Anta Sports (2020.HK). Anta currently has 256 stores in the region, with 60 in Singapore alone, and plans to add another 1,000 stores by 2028. China's second-largest sportswear brand Li Ning (2331.HK) began its layout in Southeast Asia as early as the 2000s, but its overseas revenue still accounts for less than 10%.
In the domestic market, Anta and Li Ning are leading brands, with Xtep ranking third. Many market views believe that Anta has the potential to challenge the global dominance of Nike (NKE.US) and Adidas (ADS.DE), and the company opened its first store in the United States this January. However, the three major Chinese brands generally face the issue of insufficient brand awareness in overseas markets.
Xtep's globalization exploration is still in its early stages, but it has the opportunity to become the first widely recognized Chinese running shoe brand in the global market. Its brand name itself has a strong sports association, which helps establish an international image.
<h4>Focusing on the High-Performance Market</h4>
Unlike Anta, which offers a diverse range of sports shoe products, Xtep sold its tennis and canvas casual shoe brands K-Swiss and Palladium two years ago and is currently concentrating resources on developing running shoes and hiking boots. In addition to its own Xtep brand, the company also completed the acquisition of a joint venture in 2023, obtaining Saucony running shoes and Merrell hiking boots in mainland China
The operating rights in Hong Kong and Macau for these two brands primarily target a niche market of outdoor sports enthusiasts.
Although the operating rights for Saucony and Merrell have not extended to the Southeast Asian market, these two brands have significantly enhanced Xtep's brand image among professional runners. Coupled with the gradually established reputation of its own Xtep 160X series, Xtep is gradually gaining recognition in the high-performance running shoe sector. The company stated on its official website that it has assisted 107 Chinese athletes in winning over 500 championships in major running events.
According to the 2025 annual report, Xtep running shoes have ranked first in usage among the top 100 male runners in China for four consecutive years and have ranked first among the top 100 female runners for three consecutive years. Brand ambassador Feng Peiyou set a new Chinese record at the 2026 Tokyo Marathon with a time of 2 hours, 5 minutes, and 58 seconds, ranking first among Asian athletes, further reinforcing Xtep's market positioning as a &#34;super running shoe&#34; brand. In 2025, the company sponsored 23 marathon events in China, and the 71 Xtep running clubs under its umbrella have accumulated over 2.5 million members.
Xtep's strategy of positioning the brand towards professional runners has begun to show results, at least among its target customer base. The company's revenue grew by 4.2% year-on-year to 14.1 billion yuan last year, with the footwear business, which accounts for about 60% of the total, growing slightly faster at 4.5%; annual profit rose by 10.8% to 1.37 billion yuan.
However, in contrast, the growth of the professional sports shoe business is more pronounced, covering Saucony, Merrell, and Xtep's own high-performance running shoe products. Related revenue surged by 30.8% to 1.64 billion yuan, accounting for 11.6% of total revenue; in contrast, the mass market running shoe business only recorded a modest growth of 1.5%, reaching 12.5 billion yuan.
<h4>Growth Momentum Continues</h4>
The first quarter operational data released by the company last week shows that growth momentum is still continuing. The main brand Xtep maintains growth, while Saucony brand revenue increased by 20% year-on-year. The average channel turnover period for the Xtep brand is 4.5 months, with retail discounts maintained at around 25% to 30%. Institutions such as Guotou Securities and Shenwan Hongyuan Securities believe that the above levels are within a healthy range and maintain a &#34;buy&#34; rating for the company.
The Saucony brand originates from Pennsylvania, USA, and remains one of the most competitive brands under Xtep. The brand opened its first physical store in China in Shanghai in 2020. In December 2023, Xtep completed the acquisition of its joint venture with Wolverine World Wide (WWW.US), which owns the Saucony and Merrell brands.
Xtep plans to open its first Saucony store in Hong Kong in May, marking a cautious attempt for the brand to venture outside mainland China. As for the current layout in markets outside China (including new stores in Malaysia), it mainly relies on Xtep's own brand, as the company does not yet hold the operating rights for Saucony outside mainland China, Hong Kong, and Macau
The Runner Club is one of the important tools for XTEP to shape its professional sports brand image. This model has also extended to the Southeast Asian market, with membership expected to exceed 7,000 by 2025.
However, the progress of expansion in Southeast Asia and the latest quarterly data have not significantly impressed the market. Nevertheless, among the 20 analysts surveyed by Yahoo Finance, 19 still rated the stock as &#34;Buy&#34; or &#34;Strong Buy.&#34; The company's stock price has fallen 17% this year, including a decline of about 5% since the quarterly results were announced last week, with a current price-to-earnings ratio of about 8 times, significantly lower than Anta and Li Ning's valuation levels of about 15 times.
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XTEP INT'L Holdings Limited is actively expanding into the Southeast Asian market, planning to achieve an annual overseas revenue growth of 50% over the next three years. The company has opened six new stores in Malaysia and is establishing a presence in Indonesia and Singapore. Although the running craze in the Chinese market has cooled down, the running trend in Southeast Asia is on the rise, and XTEP hopes to seize this opportunity to build a complete running ecosystem. Compared to local competitor Anta Sports, XTEP still has a gap in the number of stores

The running craze shifts south, XTEP seizes the Southeast Asian market