Textile and apparel: performance can maintain growth, sub-industry differentiation is obvious

Release Time:

2016-02-25

Textile and apparel: performance can maintain growth, sub-industry differentiation is obvious

February 25, 2016 Source: Online Textile City

1. Industry trajectory: clothing consumption has entered a stage of medium-speed growth

Looking back on 2015, the price of cotton-based raw materials fell and the RMB depreciated, and the falling cost was good for the textile manufacturing industry. Although the overall revenue of the industry has further declined, the overall profitability has gradually improved. After more than three years of adjustment, the export scale is still weak, but the structure is gradually adjusted and the inflection point of the upward trend is basically established. The overall growth rate of residents' clothing and home textile products consumption has slowed down and the growth trend has slowed down, and apparel consumption has entered a stage of medium-speed growth. The downward trend of the industry's overall revenue and profit growth continues, but the profitability is gradually improving. Under the background of the new normal, the growth rate of GDP and residents' income has slowed down, and the consumption habits of clothing and home textiles have gradually matured. With reference to the same period in the history of the United States and Japan In terms of consumption, we believe that my country's apparel consumption has entered a stage of medium-speed growth.

2. Prospects of performance: more than half of textile and garment enterprises have pre-increased performance

We predict that the overall performance of the textile and apparel sector is expected to achieve a growth of about 15% throughout the year. Among them, the overall performance of the textile manufacturing sector is expected to exceed 20% growth, the performance of cotton spinning enterprises is particularly bright, the apparel and home textile sector is expected to achieve positive growth, and the performance of companies within the sector is significantly differentiated. According to the disclosed 56 (as of February 17) listed companies in the textile and apparel industry, the performance reports and performance forecasts, the above companies achieved a total net profit of 5.91-7.51 billion yuan in 2015, an increase of 5.1-33.7% over last year under the same caliber . After excluding the growth caused by non-main business, there are 15 companies with pre-increased performance (including 4 textile manufacturing enterprises and 11 clothing and home textile enterprises), and 4 companies have turned losses throughout the year.

3. Investment strategy: focus on value stocks

In 2016, it is expected that the momentum of investment and mergers and acquisitions in the textile and garment industry will continue, and enterprises will deploy emerging fields and are expected to form new profit growth points. Continue to be optimistic about the development of the textile and apparel industry in 2016, focusing on value stocks with stable performance growth, low valuation and room for expansion. Our recommended targets include:

1. Based on the group of women and children, in a highly prosperous sub-industry, Huijie (002763), Langzi (002612) and Semir (002563) supported by fundamentals, as well as high-tech companies mainly based on capital games Flexible target George White (002687) and Dayang Chuangshi (600233). Specifically: Huijie Co., Ltd. deploys the entire industry chain of the intimate underwear industry, realizes vertical integration, and is committed to creating a market leader; Langzi Co., Ltd. is based on the female group, and builds a pan-fashion including women's clothing, baby products, cosmetics, and medical beauty. Industry; Semir clothing benefits from the expansion of the target group for the second child, and the improvement of consumption quality will rapidly improve the baby and child clothing business; George Bai has been deeply involved in the field of professional wear, and has entered the school uniform market since 2015, and there is an expansion expectation; Dayang creates traditional men's clothing and single volume The single cutting business provides a safety pad for the company's performance, and sufficient liquidity provides support for the extension expansion.

2. Based on the home furnishing industry and the sports industry, the strategy can be attacked and defended, and the segment business is launched in sequence, with fundamental support Luolai Life, Fuanna (002327), Noble Bird (603555) and Pathfinder (300005). Luolai Life is a leading home textile enterprise. It is currently transforming into a home life hall and laying out the smart home field; Fuana is committed to creating a "one-stop shopping" platform for home furnishing, promoting the smart home strategy, and working with cross-border e-commerce enterprise Zhejiang Cooperation; Guirenniao’s sporting goods business has achieved recovery growth. The company has practiced the strategy of “based on sports apparel manufacturing and coordinated development of various sports industry forms”. At present, a sports industry fund has been established, and it has invested in sports brokerage, sports media operations, etc. Field; Pathfinder also lays out three major business sectors: outdoor products, travel business group and sports business group to create an outdoor sports ecosystem.

3. Luthai A, Huafu Color Spinning (002042) and Blum Oriental (601339), whose main businesses are stable and continuously deploy overseas production capacity to improve their cost structure, benefit from the environmental protection policy to raise the industry threshold and are in the leading position in the printing and dyeing industry that accelerates the concentration of the industry. Min Shares (600987). Luthai A is a leading enterprise in the entire industry chain; Huafu Color Spinning and Blum East are one of the duopoly in the color spinning industry, with stable main businesses, and all three have advanced production capacity in Southeast Asia; Hangmin Co., Ltd. owns the printing and dyeing industry The most advanced green production equipment, the 2016 G20 Summit will further reshuffle the printing and dyeing industry in Zhejiang Province, and the company is expected to benefit from the increase in industry concentration. Source: Investment Express

Contact Us