The Profitability Of Textile And Garment Industry Has Been Rising After Transformation And Adjustment.

　　 Textile and apparel industry profitability significantly rebounded

According to the profit and loss account, it was learned that under the background of stabilizing prices of raw materials in textile sub sectors, the demand for centralized inventory replenishment in the lower reaches of 2015 promoted the recovery of the industrial chain, and the growth rate of leading enterprises increased significantly. In the first half of the year, the order volume was still recovering, and gross profit margin increased significantly compared with the same period last year. clothing In the second half of the 2014 year, the profitability of the sub industry has been restored from season to quarter, and its revenue has been increasing for 3 consecutive quarters since the 4 quarter. It is worth noting that along with the continuous advance of early discounts and inventory clearance, the gross gross profit margin of the industry has gradually returned to normal. Gross profit margin in the 15 quarter and 2 quarter has picked up compared with the same period last year, indicating that the clothing consumer market has shown a trend of improvement in demand side after brand shuffling and structural upgrading. The trend of the performance change of key consumer stocks is basically the same as that of the clothing sub sectors, but the scope is even deeper. The second half of 13 years is not as good as that of the apparel industry. Garment industry Overall, but in the second half of 14, the performance recovery has been stronger than the industry. The balance sheet reflects that the textile sub industry has significantly increased the inventory growth rate compared to the previous year under the influence of raw material price stabilization, while the apparel sub industry has substantially accelerated its inventory and receivable turnover in the first half of the year. In the first half of 2015, the improvement of the turnover rate of key consumer stocks has significantly surpassed the average of the industry and rebounded every quarter. The average number of shops decreased by more than 10%, while revenue has achieved 11.41% positive growth, reflecting that the improvement of key brand enterprises has been significantly improved through the contraction of the previous terminal scale, the structural adjustment, and the overall operational efficiency with endogenous indicators.

Three quarterly results announcement: Textile sub industry profits continue to grow, clothing sub industry performance continues to improve. At present, more than half of the 80 A share listed textile and apparel companies announced the three quarterly bulletin in 2015, of which 10 in the textile manufacturing industry and 13 in the apparel home textile industry. On the whole, we expect the three quarterly performance of the spinning and weaving industry to continue the performance of the newspaper. Among them, the textile sub industry benefits from the integration of the industry, the continuous recovery of overseas demand, and the background of the stable price of raw materials in 2015. After the burden reduction of the garment industry, the natural recovery growth brought by the endogenetic index of the terminal, and the positive transformation of the leading enterprises in the use of resources, and the continuous improvement of their growth rate year-on-year.

Since the beginning of this year, the market has been substantially outperforming, and the relative valuation is relatively low. As of August 31st, Textile and clothing The total sales of the Shenzhen composite index is about 54.87 percentage points, while the 15 year dynamic PE is about 30 times. The premium rate relative to all A shares is about 1.2 times, including 1.25 times of textile production and 1.17 times of home textiles.

After the current round of adjustment and rebound, we believe that the market will pay more attention to the industrial trend and the fundamentals of stocks, which is reflected in the textile and garment sector. We suggest that we should pay attention to two logical lines to screen. Individual stock (1) the horizontal / vertical industrial chain deepening logic under reasonable PE Valuation: first, the textile sub sectors with clear industrial logic will benefit from the anticipation of industrial chain recovery, cotton price rise and the signing of the Vietnam TPP tariff agreement. The leading enterprises, such as Huafu color, Bailong, urfe, lufa and Lutai A, have benefited significantly. The annual performance is expected to be more beautiful. Secondly, we should deepen the fine molecular industry and take advantage of external forces to deepen the industrial chain horizontally or vertically, such as AOKANG international and Semir. Clothes & Accessories Fu Anna leveraged cross-border electricity providers, deep ploughed shoes, casual wear, home textile fine molecular industries, Xingxi bird and so on actively explore the industrialization of garment customization; Xingye technology focuses on the upstream and downstream integration of leather industry chain; relying on the original thermoelectric capacity, the group sells electricity field to benefit from the electricity reform; (2) the non epitaxy shell resources, IPO postponed and the registration system is slowing down, the shell value of some small cap companies is highlighted again. We believe that the non epitaxy and real small market value companies are worthy of attention, such as 3 billion below the market value, and 20% below the large shareholding ratio, Feng Zhu textile, Kai Reed and so on.

Risk warning. Overseas recovery is not as good as expected, domestic retail market remains sluggish, terminal demand is sluggish, industry operating costs continue to rise, industry competition is intensified, demand for cotton market is not up to expectations, and policy change risks are all factors restricting development of the industry.