Spandex Prices Rose &Nbsp; Two, The Company's Performance Is Worth Looking Forward To.

　　 along with Domestic cotton Price increases, especially since October, cotton prices have continued to rise, prices of all kinds of chemical fiber products have risen in varying degrees. Recently, spandex prices have seen a wave of accelerated rise. We believe that spandex The rise in prices is related to the relevant listed companies. achievement Will play a significant role in thickening, so spandex listed companies in the fourth quarter of this year's performance is worth looking forward to.

　　 Spandex prices rose more than 20% in November.

The rise of cotton prices has led to a rise in prices of all kinds of chemical fiber products. The price of spandex has increased sharply in recent years.

The price of spandex has been rising slightly in September. Before that, the domestic market price of spandex 40D basically maintained at 51000 yuan / ton, spandex 20D price basically maintained at 73000 yuan / ton.

According to the data of China textile net, in the first week of November, the average price of spandex 40D week in the domestic market is only 55000 yuan / ton, and the average price of spandex 20D week is only 74000 yuan / ton; in November, second weeks, the average price of spandex 40D week rose to 61400 yuan / ton in the domestic market, and the average price of spandex 20D rose to 82000 yuan / ton; last week (third weeks in November), the average price of spandex 40D week in domestic market has risen to 69000 yuan / ton, and the average price of spandex 20D has risen to 90000 yuan / ton, spandex price has reached a new high in the year. Spanning the whole November, the price of spandex has increased by more than 20%.

As of October this year, the spandex industry has made three overall increases. In January this year, the price of spandex 40D was raised by 3000 yuan / ton to 51000 yuan / ton. In April, the Spandex Industry Association reunified the price of the product by 2000-3000 yuan / ton, and the price of spandex 40D rose to 57000 yuan / ton. The price of spandex 20D rose to 83000 yuan / ton. But since May, the price of spandex has begun to drop. In September, the spandex business once again reached the price increase agreement, and the price of the spandex product will be raised 3000 yuan / ton.

However, the sharp rise in the price of spandex in November did not come from the news of the unified price rise of trade associations.

Two reasons support price rise

The spandex prices rose sharply, first because of the support of spandex raw materials (including PTMEG and MDI), and the main reason is that due to the growth of downstream demand and the pressure of power limitation, the supply of spandex is tight and inventory is declining. We expect that spandex prices are still rising in the near future.

Supply is tight. Domestic Spandex Enterprises have a relatively high degree of competition, and prices are mainly determined by supply and demand. At present, the downstream textile industry of polyurethane fiber has entered the peak season. The demand for spandex in Guangdong, Fujian and Zhejiang is on the rise. At the same time, due to the power restriction and shutdown in some provinces, the operation rate of the spandex industry has dropped slightly. With the increase of demand and relative reduction of supply, the inventory of spandex production enterprises has begun to decrease.

On the export side, according to the latest import and export statistics released by the General Administration of Customs in October, the export volume of textile yarns, fabrics and articles in the 1-10 months of this year totaled US $62 billion 614 million, representing an increase of 29.40% over the same period last year. The total amount of clothing and accessories exports totaled 104 billion 996 million US dollars, representing an increase of 19.50% over the same period last year. The further improvement of external demand for textile and garment products also provides a strong pulling effect on the price increase of Spandex Products. Traditionally, the fourth quarter will be a small peak for textile exports, and the demand for spandex will continue to grow steadily in the future.

Raw material cost support. According to the analysis of spandex production cost, the main raw materials of spandex products are pure MDI (two phenyl methane diisocyanate, isocyanate) and PTMEG (polytetrahydrofuran glycol). In terms of dosage, the amount of PTMEG used in each spandex is about 80%, and the pure MDI occupies about 20%. From the perspective of cost accounting, PTMEG accounts for about 50% of total production cost, while pure MDI accounts for about 10% of total production cost.

While spandex prices rose in November, the price of its main raw materials did not increase significantly. At present, the PTMEG price, which accounts for 50% of the cost of spandex, is maintained at around 30 thousand yuan / ton, and the price of the pure MDI East China market with a relatively small cost remains at 22000-22500 yuan / ton. But spandex raw materials rose earlier, especially PTMEG, from the beginning of this year to the end of October, the cumulative increase has exceeded 35%. The transmission of upstream raw material cost plays a supporting role in the price increase of spandex.

Two, the company's performance is worth looking forward to.

The price increase of spandex will play a significant role in enhancing the performance of the relevant listed companies. Therefore, the performance of spandex listed companies in the fourth quarter of this year is worth looking forward to.

In the three spandex production listed companies, we are most optimistic about Yantai spandex. At present, the company has spandex production capacity of 22 thousand tons / year, Aramid 1313 production capacity of 4300 tons / year (this year after technical improvement to 4600 tons / year).

Projects under construction include: (1) the 5000 tons of medical spandex production line is in the process of construction, and is expected to be put into production in the near future. (2) the 7000 tons of comfortable spandex fiber project is planned to start construction in April 2010, and will be put into operation at the end of June 2011. (3) the 1000 ton industrial aramid 1414 project has been launched, and the project is expected to complete equipment installation by the end of 2010, and the trial operation will begin at the beginning of 2011. The company's unique aramid business will bring more room for development.

We expect Yantai spandex 2010-2012 years EPS to be 1.04 yuan, 1.28 yuan and 1.40 yuan respectively, and the corresponding dynamic price earnings ratio of the latest stock price is 30 times, 25 times and 23 times respectively, so as to maintain the company's "highly recommended" investment rating.

In addition, Huafeng spandex specializes in R & D, production and sales of spandex fiber, and is the largest spandex fiber manufacturing company in China. The company currently has 42 thousand tons of spandex annual capacity (excluding construction projects), has 48 production lines, ranking first in the country, ranking third in the world, and has a prominent scale advantage. We expect the company's EPS in the 2010-2012 year to be 0.44 yuan, 0.57 yuan and 0.66 yuan respectively, and the corresponding dynamic price earnings ratio of the latest stock price is 29 times, 22 times and 19 times respectively, so as to maintain the company's "recommended" investment rating.

　　 Risk warning: the risk of spandex price fall; the risk of substantial increase in raw material prices; and the risk of increased competition in the industry.