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Textile And Garment Retail Sector Is Still In The Initial Stage Of The Market.

2011/4/27 14:42:00 86

Textile And Garment Retail Sector Investment Strategy Cotton Prices Down

In the 2 quarter industry strategy, we pointed out

Cotton prices fall

As a catalyst for the start of the textile and apparel retail sector, the textile and clothing retail stocks performed well this week with the fall in cotton prices. The seven wolves, Luo Lai, fuanna, Meng Jie, the wedding bird and the United States all rose.

Despite a week's rise, the 11 year dynamic valuation of the seven wolves is only 25 times, 17 times of Weixing share, 26 times of Meng Jie's home textiles, 29 times of fuanna, 27 times of Semir after the launch, and it has a very high margin of safety, and there is still much room for it.

We believe that for these excellent brand retail enterprises, we need to intervene at low valuations and adopt buy and hold strategy.

Next week, it is still recommended to focus on seven wolves, fuanna, Luo Lai, Meng Jie, Weixing, Semir, and good news birds. Considering that this week's general inflation rate is not large, it is likely to show a trend of inflation next week, and then start differentiation.

Cotton prices in recent years as we expected to continue to decline, and other chemical fiber peak season is not only bad, but cold and dry down, viscose staple fiber prices continued to drop 1000 yuan this week, down to 24000 yuan after last week's sharp fall, spandex 40D prices continued to fall 1500 yuan to 55500 yuan, fully shows that the demand for high priced raw materials, mainly due to the obvious suppression of foreign demand.

We believe that cotton prices may stabilize in the 4 quarter, and then there will be opportunities for chemical fiber and manufacturing stocks.

Still in 2011

investment strategy

Invariable: first, continue to be optimistic about textile and garment retail enterprises. Good performance and falling cotton prices may become catalysts for stock prices: 3-4 is an important investment window.

On the one hand, annual reports and quarterly reports are beautiful, and the reliability improvement of the 11 years' performance growth will provide investment opportunities; on the other hand, the autumn and winter clothing orders of textile and garment retail enterprises in 3/4 will achieve great expectations, and the leading enterprises have more than expected expectations; in addition, the determination of cotton prices will also help to dispel the market worries; two, the export manufacturing textile enterprises should have a low gross profit margin; the three and 3-6 months may decide the future cotton price direction, and the downward probability is greater than the upward probability.

Next week's investment strategy

This week, the A share market has gone up and down.

The Shanghai Composite Index closed at 3050.53 points, a gain of 0.68% a week, and Shenzhen composite index closed at 12965.75 points, a 0.54% decline in a week.

The chemical fiber sector continued to outperform the market this week, up 0.81%, but the textile and garment sector this week slightly outperformed the overall market, rising by 0.41% overall.

This week, the eye-catching stock in the plate was Hua Sheng shares, which rose 12.70% weekly.

Our expectations for falling cotton prices continue to be tested.

We believe that the downward trend of cotton prices in the 2 quarter is greater than the upward trend. Following last week's China cotton price index (level 328) fell below 30 thousand yuan, cotton prices continued to fall this week, and the latest cotton price index (grade 328) dropped to 29311 yuan.

In addition, other chemical fiber is not only busy season, but cold and clear prices continue to fall, which fully shows that the demand for high priced raw materials is mainly due to the obvious suppression of foreign demand.

In the 2 quarter, we pointed out that cotton prices fell down in the industry strategy.

Textile and apparel retail sector

The catalyst started this week. The textile and apparel retail sector performed better this week. There was a rare inflation. Seven wolves, Luo Lai, fuanna, Meng Jie, good bird, and barpson all rose. The 2 quarter strategy was gradually verified by the market.