Asian Dividend Gems: Crystal International

• Crystal International 's business operations started to turn around in 2024 as most brand customers ended the destocking cycle and adjusted their inventory strategy.

• Crystal International is trading at attractive valuations of EV/EBITDA of 3.5x and P/E of 8.1x, based on 2025 consensus earnings estimates. Estimated dividend yield is at 6.5% in 2025.

• The company is one of the largest OEM apparel manufacturers in the world. It has a proven record of executing its business strategy successfully for more than five decades.

Conclusion First

Crystal International (2232 HK) is one of the largest OEM apparel manufacturers in the world. The company has a proven record of executing its business strategy successfully for more than five decades.

The company's business operations started to turn around in 2024 as most brand customers ended the destocking cycle and adjusted their inventory strategy, moving their procurement quantity in line with their sales growth.

Crystal International has attractive valuations. It is trading at EV/EBITDA of 3.5x, P/E of 8.1x, and P/B of 1.1x, based on 2025 consensus earnings estimates. Estimated dividend yield is at 6.5% in 2025. Net cash represents 28% of its market cap.

Crystal International's share price is up 74% in the past one year, outperforming Hang Seng Index which is up 44% in the same period. We believe Crystal International is well poised to continue to outperform the Hang Seng Index in the next 6-12 months.

Company Background

Crystal International (2232 HK) is a leading OEM apparel manufacturer headquartered in Hong Kong. The company specializes in designing and producing a wide range of apparel, supplying major international fashion brands.

Crystal International was founded in 1970 by Kenneth Lo and his wife Yvonne Lo. Initially a small garment manufacturer, the company expanded rapidly, securing partnerships with leading fashion brands and retailers worldwide. The founder, Kenneth Lo, serves as the Chairman, while his son, Andrew Lo, holds the position of Chief Executive Officer. Over the decades, Crystal International has grown into one of the largest apparel manufacturers in the world, operating across multiple countries and serving a diverse customer base.

Crystal International operates through various product categories, catering to different market segments. The company’s core product lines include:

• Intimate Apparel – Lingerie, sleepwear, and undergarments

• Activewear – Sportswear, performance apparel, and athleisure

• Knitwear – Sweaters, cardigans, and casual knit garments

• Denim – Jeans, jackets, and denim-based products

• Lifestyle Wear – Casual and formal wear, including shirts and dresses

Crystal International operates 20+ manufacturing facilities across Asia, including China, Vietnam, Cambodia, Bangladesh, and Sri Lanka. Crystal International has built a strong workforce that enables large-scale production while maintaining high-quality standards.

Crystal International partners with some of the world's most recognized fashion and retail brands. These include:

• Fast fashion retailers (e.g., H&M, Uniqlo, Zara)

• Luxury brands (e.g., Ralph Lauren, Hugo Boss)

• Sportswear companies (e.g., Nike, Adidas, Puma)

• Department stores and private labels (e.g., Macy’s, Marks & Spencer)

The company’s ability to manufacture a wide range of apparel for different price points and quality requirements has made it a preferred supplier for global brands.

In March 2024, Crystal International opened its first phase of its $70 million factory in Vietnam. The company spent $34 million in the first phase of the project. This factory is expected to employ 2,650 people once fully operational.

Crystal International is a partner of major global brands, including H&M, Adidas, Nike, Under Armour, Uniqlo, Victoria's Secret, Puma, and Levi’s. The company operates 20 factories in Vietnam, China, Bangladesh, Cambodia, and Sri Lanka. Vietnam accounted for nearly half of the company's total employees at the end of 2022.

A successful company philosophy - “For the Greater Good” in Crystal International (Source: Crystal International, Youtube)