The Possibility Of Becoming A Hot Spot In Textile And Garment Retail Sector Is Improving.

This week, the textile and garment sector continued to rise against the market, but at present, the valuation of quality enterprises such as seven wolves, Weixing, good bird, and fuanna in the plate is still low. The valuation of the seven wolves is only 24 times, 19 times of Weixing share, 24 times of the wedding bird, 26 times of Meng Jie's home textile and 27 times of fuanna, and has a very high margin of safety.

We think these brands are of excellent quality.

Since the second half of last year, the textile and garment retail sector has been adjusted to this day.

The adjustment is not because the market is worried about the performance, but mainly the plate rotation, and the market focus turns to cyclical stocks. In addition, the high cotton price causes the market to worry about the decline of the gross profit margin of the enterprises, and the worry that the consumers' purchase intention may drop after the price rises.

We believe that the "recovery of the bell must be tied to the bell". The recovery of the textile and garment sector in the future will still depend on the pformation of market hot spots and the reduction of raw materials.

We have always thought that the 2 quarter cotton price will determine the future direction, and the downward probability is slightly larger than the upward probability.

In recent years, domestic and foreign cotton prices continue to decline, coupled with the seven wolves 3/4 month orders will be exceeding expectations, we believe that the textile and garment retail sector once again become a hot spot in the market is increasing.

We still recommend focusing on seven wolves, Weixing, and Luo Lai this week.

2011 investment strategy: first, continue to optimistic about textile and apparel retail enterprises: 3-4 months is an important investment window.

On the one hand, the beautiful 10 year annual report and the 11 year one quarterly bulletin are gradually announced. The high delivery rate and the reliability improvement of the 11 year performance increase all provide investment opportunities; on the other hand, the autumn and winter clothing of 3/4 textile and garment retail enterprises on the other hand.

Considering the fluctuation of cotton price, we suggest that we should pay close attention to leading enterprises with raw material reserves, such as Lu Tai and Huafu color spinning. Three and 3-6 may decide the future cotton price direction, and the downward probability is slightly larger than the upward probability.