Four Quarter Investment Strategy Of Textile And Garment Industry

Industry profits picked up significantly, and profitability in the medium term increased significantly.

In the first 8 months of this year, the main factors of improving the industry's favorable industry efficiency have not changed. The total revenue and profit have increased rapidly. The total operating income and profit of the textile industry increased by 26.83% and 53.6% respectively. The apparel industry increased by 22.35% and 30.92% respectively over the same period.

Benefit from domestic economic recovery in the medium term Textile and clothing The overall profitability of the industry increased significantly. The 27 Sample Firms operating income and net profit increased by 36.88% and 27.84% respectively, and the gross profit margin increased by 3.53 percentage points on average. Among them, the net profit of brand retail industry in China's textile industry increased by 45% over the same period last year, and the net profit of the textile industry in the manufacturing industry increased by 66% year-on-year.

Export growth will slow down, manufacturing enterprises can hardly be optimistic.

At present, faced with unfavorable factors such as slowing export growth, pressure on RMB appreciation, rising raw material prices and rising labor costs, it is expected that the profit margins and profit growth rate of manufacturing enterprises in the fourth quarter will decline and overall investment opportunities will be smaller to maintain the "holding" rating of the sub sector.

A few have advantages of scale and brand effect. manufacturing enterprise It has the ability of cost transfer. We recommend that we focus on the excellent enterprises that are pioneering and enterprising, highly growing and valued, including Weixing [28.70 2.28%], Huafu color spinning [22.55 2.27%] and Luen Fat share 1.32%] [41.44.

The trend of domestic retail growth is clear, and enterprises with brand and channel advantages will continue to maintain high growth.

In the first 8 months of this year, the total retail sales of domestic consumer goods increased by 18.2% over the same period last year, with the total retail sales of textiles and clothing above the quota increasing by 23.7% over the same period last year. With mild inflation showing and domestic residents' income level, purchasing power and consumption will continue to improve, it is expected that the total retail sales of clothing will continue to maintain a high growth rate of about 20%.

At present, most textile and clothing in China Retail type Enterprises are in the common strengthening stage of channels and brands. Brand will enhance the ability of channel negotiation, expand channels and increase market share and brand awareness. We believe that enterprises with brand and channel advantages will continue to maintain high growth.

Investment advice and risk warning

The fourth quarter is the peak season for textile and clothing consumption. The four quarter retail sales growth is expected to reach 25%. The sub industry recommends attention to home textiles, brand clothing, outdoor products and women's shoes. It is recommended to pay attention to companies with basic support, profitability and income elasticity. It is recommended to pay attention to [73.94 1.29%], [45.41 -0.37%], Wolfgang [33.54 -0.37%], seven wolves [33.54 1.48%], wedding bird [27.50 1.81%], Meng Jie home textiles [43.97 0.39%], American bond dress [28.80 4.73%], Pathfinder [28.80 and Saturday. The main risk is domestic economic slowdown, raw material prices skyrocketing and plummeting, and RMB appreciation brings exchange rate risk. (GF Securities [31.22 2.29%] Research Center)