Textile And Garment Industry &Nbsp; High Cost Era Accelerates Polarization.

Growth momentum was good in the first quarter.

Wind statistics show that as of April 27th, 54 listed companies in Shenyang Wanguo textile and garment industry announced a quarterly report in 2011. Over 70% of the company's profits maintained a good growth momentum compared with the same period last year. Only 4 companies had net profit losses, and 10 companies had slipped year by year.

There were 19 companies whose net profit increased by more than 50%.

A quarterly report shows that in the context of the obvious recovery of domestic and foreign economies, both exports and domestic demand markets have shown a good momentum, and have also created a good operation environment for the textile and garment industry. The trend of the industry is expected to continue for some time to come.

In the first quarter of this year, the export volume of textile and clothing increased substantially beyond expectations.

Customs data show that in the first quarter, China's textile and apparel exports totaled 48 billion 627 million US dollars, up 23.96% over the same period last year.

Among them, the export of textiles was US $20 billion 165 million, an increase of 32.71% over the same period, and exports of clothing and accessories reached US $28 billion 461 million, up 18.42% over the same period last year.

The industry believes that, in the environment of rising raw material prices and labor costs, domestic export enterprises have increased the prices of export products, and the price of export products has been increasing continuously every month, the range is around 5%-10%, resulting in a significant increase in export volume.

At the same time, the domestic market is also unwilling to lag behind.

Statistics show that in the first quarter, the total retail sales of clothing, shoes and hats and needle textiles in Enterprises above Designated Size reached 201 billion 400 million yuan, an increase of 22.3% over the same period last year, and the growth rate greatly exceeded the growth rate of 16.3% of the total retail sales of consumer goods. This shows both the demand and vitality of the domestic demand market, and also indicates that the competitive advantages of large and medium-sized enterprises in the industry have been further strengthened.

As domestic and foreign textile market demand warmed up, the company's product prices rose year-on-year, gross profit margin increased, and the base year was low. Changshan shares (000158) net profit increased by 81 times in the first quarter, and the company expects net profit in the first half of this year to be 16 million yuan -2000 million, representing an increase of 99.61%-149.51% over the same period last year.

The rising cost of raw materials and labor has become the main pressure faced by textile and garment enterprises. The cost pfer ability of enterprises with comprehensive competitiveness of scale, quality, R & D and industrial chain is also higher than market expectations.

Lu Tai (000726), an old textile enterprise, showed quarterly net profit of 200 million yuan, up 40.17% from the same period last year.

The increase in sales revenue came mainly from the increase in sales of leading fabrics and shirts, as well as the increase in product prices, of which the effect of price increase was more important in the first quarter.

Raise prices or become a driving force for earnings growth

As many textile and garment enterprises are in line with the order production, from the spring and summer ordering situation of some brand enterprises, the order growth rate is basically above 30%. The industry therefore expects that the average net profit growth rate of the textile and garment industry in 2011 may exceed 40%.

However, the increasingly high CPI has some crowding out effect on the consumption of mass textile and clothing.

Shenyin Wanguo Securities Wang Liping said that in this year's CPI higher background, due to rising cost driven product prices, the overall sales of domestic clothing retail terminal growth will not be great.

Against this background, it is more optimistic about the high-end business casual men's wear and home textiles, which are highly priced, high priced, and customers are less sensitive to prices. The growth of these enterprises' profits will increase more by raising the gross profit margin.

On the export side, Li Jie, Everbright Securities, believes that under the dual impact of the international and domestic economic situation and China's huge foreign trade base, it will continue to expand the original market space and face the problem of "ceiling". It is estimated that the growth rate of textile exports will be reduced to about 10%-15% in 2011, and the price increase will become the main driver of export growth.

The adverse factors such as the sharp rise of raw materials and labor costs in 2011 will bring polarization to the enterprises in the industry. The "order to large enterprises" will make the leading enterprises place more emphasis on the quality of the order, while more small and medium-sized enterprises will withdraw from the market competition.

In the era of high cost, structural adjustment of textile industry is also inevitable, and advantageous resources will accelerate to large enterprises.

Leading enterprises in the industry with certain brand advantages, channel advantages and product advantages will win more market share.