Textile Industry Pressure Unprecedented Tax Rebate Rate Adjustment Facing Uncertainty

Recently, investors are concerned about the possibility of increasing the export tax rebate rate of textile industry and whether the pressure on the future industry can be alleviated. On the basis of consulting relevant personnel, the form cost report mainly involves two aspects: (1) the current situation and causes of the industry downturn, (2) the possibility of the increase in export tax rebates and its impact on the industry and related listed companies.

The sluggish pattern of production enterprises is difficult to improve in the short term.

(1) in 2008, it became the most difficult time for the textile industry. In 2008, the total profit growth in 2008 was the lowest in recent years.

(2) we believe that the important reasons are: RMB appreciation, export tax rebate rate reduction, weak demand growth in the United States, the substitution effect of neighboring countries, and a substantial decrease in investment returns over the same period last year.

There is uncertainty in the export tax rebate rate increase.

(1) we think there is uncertainty about the increase of the export tax rebate rate: the export growth rate is still at a high level; the export rebate rate is contrary to the requirements of the upgrading of the national industrial structure; in 2008, China's economy is facing more problems, and the textile industry is not the most difficult industry.

(2) even if the export tax rebate rate is up to 2 percentage points, such as the legendary textile industry, the percentage of garments raised by 4 percentage points will be mainly short-term trading opportunities.

Brand clothing and accessories are less affected by the industry downturn.

(1) the steady development of China's economy in the past 30 years has provided a solid foundation for the brand clothing consumption. The growth of the single store generated by channel expansion, product line extension and store expansion has become a direct driving factor for the growth of clothing brand enterprises.

(2) excipients are an important part of improving the brand quality of clothing. The growth of demand for medium and high grade accessory products will exceed the average level of the industry, and the market has the characteristics of gradually concentrating on leading enterprises.

Selection of Listed Companies in the industry.

In line with the medium-term strategy of "textile and garment industry: the flower of the brand", combined with the valuation and historical dividend, we recommend the choice of anti risk varieties and recommend YOUNGOR and Weixing shares.