ANTA SPORTS (02020.HK) shares plummeted 5.17% in Monday's pre-market trading, following a controversial fireworks display by its subsidiary brand Arc'teryx in the ecologically sensitive Himalayan region. The incident has ignited widespread criticism and raised serious questions about ANTA SPORTS' environmental, social, and governance (ESG) practices.

The controversy stems from a collaboration between Arc'teryx and artist Cai Guoqiang, which involved setting off fireworks in the Qinghai-Tibet Plateau area. Despite claims of using biodegradable materials, the event faced immediate backlash from environmental organizations and the public, who argued that such activities could cause irreversible damage to the fragile high-altitude ecosystem. The discrepancy between Arc'teryx's domestic and international apology statements further fueled public outrage, undermining the sincerity of the brand's response.

As the parent company of Amer Sports Group, which owns Arc'teryx, ANTA SPORTS now faces scrutiny over its ESG governance capabilities. The incident has exposed potential deficiencies in the group's environmental risk management for subsidiary brands, potentially impacting investor confidence. With ANTA SPORTS pursuing a globalization strategy, this controversy could significantly affect not only its main brand image but also its international expansion plans, leading investors to reassess the company's valuation and future prospects.