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Textile And Clothing: Upgrading Of Consumption To Enhance Bargaining Power In The Industry

2011/10/14 11:31:00 31

Consumption Upgrading Textile And Clothing Consumption Price

The first three quarters of the trend review: the industry as a whole wins the market, the apparel home textile sub industry has accumulated a lot.

In the first three quarters of 2011, the textile and garment sector fell by 13.09%, while the Shanghai Composite Index, Shenzhen stock index and Shanghai and Shenzhen 300 fell by 17.30%, 19.05% and 19.07% respectively.

Half year results support the three quarter performance of apparel home textile industry is relatively strong, and won 5 and 3 percentage points, respectively.

Price trend: cotton prices are low and volatile, and clothing prices are rising rapidly.

We believe that the fourth quarter of domestic cotton prices around 20000 near the possibility of a narrow shock, and expected the end of the four seasons cotton prices have a potential to pick up the bottom.

We expect that the overall consumer price growth rate of clothing is expected to remain high, while the price structure of some products that benefit from consumption upgrading is expected to accelerate.

Import and export: upgrading of textile products, clothing

Domestic demand market

Starting.

In the first 8 months of 2011, exports of textile manufacturing sub sectors showed a "drop in price" feature, and the upgrading trend of product structure was continued.

In the apparel home textile industry, the trend of pformation from export to domestic demand market is obvious.

downstream

retail

Market: price increase to promote stable and rapid growth of retail sales.

In the 1-8 month of 2011, the total retail sales of textile and clothing above the quota increased by 24% year-on-year, basically unchanged from the same period last year.

Price increases are the main driving force for growth.

Upstream manufacturing: de stocking, production growth has slowed down significantly.

In the first half of 2011, the production and sale rate of textile manufacturing industry decreased significantly, and the de stocking is still the current development of the industry.

Despite the slowdown in output growth, the growth rate of fixed asset investment in the entire textile and garment industry remains high.

Valuation and investment strategy: pay attention to the improvement of bargaining power and the upward movement of valuation, and the industry "optimistic" rating.

We believe that the valuation differentiation of the two sub sectors reflects the expectation of the market for the growth of their fundamental performance.

Based on the strong bargaining power of the brand apparel industry and the rising value of the consumer goods industry, we believe that the valuation of the apparel home textile industry has the opportunity to move upward.

Textile manufacturing sub industry: pay attention to R & D and scale advantages to bring higher value-added products, recommend Lu Tai A (000726); clothing

Home textiles

Sub sectors: the trend of consumption upgrading is obvious. Concerned about the capacity of channel expansion and raising prices, we recommend birds of good luck (002154), seven wolves (002029), Semir clothing (002563), Kaiser shares (002425), fuanna (002327) and Roley home textiles (002293).

Risk warning: the European debt crisis and the deterioration of the US economy exceed expectations; the domestic inflation situation exceeds expectations; the macroeconomic downturn hits consumer confidence; raw material prices fluctuate violently, and the monetary policy environment deteriorates.