Diversified Development Of Textile And Garment Enterprises

Since 2004, domestic clothing has entered a golden stage of rapid development with an average annual growth rate of over 20%. Meanwhile, exports were affected by unfavorable factors such as the financial crisis and RMB appreciation, and the growth rate continued to decline.

Since 2007, domestic sales growth has exceeded three consecutive years.

In the long run, the prospect of domestic clothing consumption market is broad, mainly due to the improvement of residents' consumption level, the promotion of urbanization and the rapid economic development in the central and western regions.

At the same time, the annual output value of China's home textile industry in 2010 was 654 billion yuan, an average annual growth of 20%, which is one of the high growth industries in China.

According to the China Textile Industry Association survey, China's per capita textile consumption is 27% lower than the world average.

After ten years of development, domestic textile industry has laid an important position in the textile industry of "one of the three parts of the world".

In the next five years, the textile industry, the important national industry of the people's livelihood, will have a period of strategic opportunity.

From the external development environment, the sustained growth of the international economy will benefit China's textile exports. At the same time, the domestic expansion of consumption strategy will provide broad room for the development of the textile industry.

Especially after the per capita GDP reached US $3000, residents' consumption entered the stage of accelerated consumption, which brought important development opportunities for the home textile industry.

At present, China has become the second largest economy in the world, but its consumption accounts for only 5.4% of the world's total.

The structural contradictions formed in the long-term development of the textile and garment industry are fully manifested in the international financial crisis. Insufficient independent innovation capability is still a bottleneck. Imperfect industrial value chain is a weak link in the development of the textile industry.

Traditional industries seek growth and become new energy sources

2010 annual report shows that Jiangsu SunShine Co achieved operating income of 3 billion 106 million 315 thousand and 600 yuan, an increase of 19.98% over the same period last year.

Operating profit of 85 million 463 thousand and 100 yuan, a decrease of 42.65% over the same period last year.

Net profit attributable to the owners of the parent company was 62 million 508 thousand and 900 yuan, down 40.48% from the same period last year.

Because of the shrinking profit margins in the textile industry, Jiangsu

In addition to Jiangsu's sunshine to the new energy industry,

Huafang's lithium power business is mainly concentrated in the company's holdings of 70% Li Tian Amperex Technology Limited and holding 70% of its subsidiary Hua Tianxin Materials Co., Ltd.

Last year, the company's lithium battery and electrolyte business profit margins were negative.

Analysts believe that the company's lithium business progress is lower than expected, mainly due to low utilization of capacity, expected profit this year may be improved.

Li Tian is a professional manufacturer of lithium iron phosphate batteries.

At present, the lithium iron phosphate battery powered by the company is also mainly used in the field of electric bicycles.

Li Tian company's first annual production line of 8 million AH lithium iron phosphate power battery was put into operation in March 2010. In 2010, the company's products were in the initial stage of market development, and the running in with downstream customers was a gradual process, and the total utilization rate of capacity was still low.

Northeast Securities analyst said that the company's battery products in November 2010, the production and sales situation is good, performance is expected to be released in 2011, this year's new battery production line is more likely.

The company's annual output of 5000 tons of electrolyte business is operated by Hua Tianxin Materials Co., Ltd.

In early June 2010, the company announced that the electrolyte project had passed the EIA and Ann assessment.

In July 2010, the company's electrolyte products entered the trial production stage, and small batch products were delivered to customers for testing.

Analysts believe that the monthly output of the company's electrolyte is close to 100 tons, and this year it may be profitable.

Huafang textile has said that Li Tian products have been tested many times by Li Tian laboratory, and have passed the national electric bicycle product quality supervision and inspection center, and its safety performance index is excellent.

Huafang textile believes that in the process of nurturing new enterprises and new products, Jiangsu Li Tian insisted that the mass produced products should be pushed to the market after repeated tests, and at the same time, accelerate the pace of research and development of high-end products.

Huafang textile said that stepping into the new energy battery industry is to seek new profit growth points and enhance the company's continued profitability.

Main business growth

Because of the deflation of the national economic policy this year, the overall operation of the textile industry has also been negatively affected.

At the same time, rising inflation pressure and appreciation of the renminbi have led to concerns about the negative impact of industry demand.

In addition, the external factors such as the impact of Japan's earthquake and the instability of the international political situation have also deepened this concern, resulting in a high fall in cotton prices.

Industry analysts believe that cotton prices will continue to be high and volatile before new cotton comes into market this year, and demand factors will lead the future cotton prices.

At the same time, the prices of polyester, viscose, spandex and other chemical fiber products with certain substitution effects on cotton also dropped correspondingly, among which viscose fiber and spandex fiber decreased greatly.

Jiangsu sunshine main business is wool washing, strip making, dyeing, combing, spinning, weaving, dyeing and finishing. It is the largest worsted spinning enterprise in the world and the key high-tech enterprise of the national Torch Program.

Sunshine trademark is the only well-known trademark in China's Worsted industry that has been identified by the State Administration of industry and commerce.

Jiangsu sunshine has 120 thousand spindles and 600 looms. It is the largest production base of high grade and thin fabric in China.

The main product of "sunshine card" worsted fabric ranks first in the domestic market share.

Huafang textile belongs to Huafang group, which is mainly owned by textile. Huafang textile is its listed company.

The group produces 350 thousand tons of cotton yarn per year, 200 million meters of all kinds of cotton cloth and 25 million meters of woolen cloth. Its cotton textile industry has been in the world second, and the wool textile dyeing industry ranks among the largest worsted fabric production bases in the world.

Such business is bound to depend on cotton, the most important raw material in the upstream cotton textile industry.

According to Huafang annual report, the best performance in 2010 was also due to the grasp of cotton prices.

In 2010, due to the double effects of market warming and adverse weather, cotton supply was once in serious shortage, and cotton prices also rose.

Huafang, which has always been in the front of the industrial chain, mainly provides veils and other cotton textiles, and its bargaining power increases when the price of cotton is high.

Huafang is looking for the right time to lock in a large number of low priced cotton, while Huafang also raised its price of veil products and greatly increased its gross profit margin in 2010.

Although the overall income and profitability of the industry are at a relatively high level, the profitability of the upstream industry of the industry chain is showing signs of weakening.

From January 2011 to February, the total profit of the upstream textile enterprises increased by 50.52% over the same period last year, a decrease of about 2.1% over the whole year of 2010, and the net profit margin of sales decreased by 0.1 percentage points compared with that in 2010. The total profit margin was 4.61%, mainly due to a decrease of 0.35 percentage points in gross profit margin.

The total profit volume of downstream textile and garment industry increased by 46.07% year-on-year, and sales profit margin and gross profit margin reached a new high, reaching 6.21% and 16.42% respectively.

In the future, the industry will lose profits and there will be a downward pressure.

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In 2010, the overall profitability of the textile and garment industry increased significantly, mainly due to the contribution of low price inventory and product price increase. Due to the high raw material inventory factor after September 2010, raw material prices continued to maintain high volatility this year. Textile and garment enterprises will face more severe cost pressures this year, and the overall profitability of the industry may be affected.

If raw material prices continue to maintain a historical high volatility, this will directly test the ability of textile and apparel enterprises to pfer costs through raising prices, and the ability to deal with risks of cost changes flexibly.

Jiangsu sunshine profit distribution map

Profit distribution plan of Huafang textile

Textile industry will continue to concentrate its future advantages.

The industry believes that the listed companies of textile and clothing will face a great shuffling effect. On the one hand, some high-quality listed companies will shift the focus of the market to domestic demand, that is, according to the consumption upgrading needs brought by the current wealth growth of the residents, the high-end brands will be vigorously expanded so as to gain a new market opportunity to rise, and the men's clothing brand will also benefit from the sales mode of the exclusive stores and so on, which will become a major highlight of the textile industry in the near future.

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On the other hand, some listed companies are facing the pressure of the market, or to enhance their profitability and increase their asset restructuring.

This is also divided into the integration of main business and the development of new businesses.

This is mainly reflected in the group's high quality assets of textile and apparel listed companies, or the acquisition of high-quality textile assets expected strong enterprises, textile enterprises into the era of diversification, in order to achieve growth momentum.

In 2011, the overall demand for domestic textile and clothing will continue to recover, but the process is tortuous.

The appreciation of RMB and the cost pressure of raw materials and labor will seriously affect the average profit level of the industry.

Because of the constant upgrading of the domestic textile consumption market, Quan Zengqiang, the market leader of the downstream leading enterprises with resource superiority in the era of high cotton prices, has become increasingly popular.

The rising price of cotton makes the price of all links in the textile and garment industry chain (yarn, grey cloth, fabric, clothing and textiles) rising, but the price increase in each link is basically the same as that of the cost increase. Therefore, under the situation of raw material price fluctuating, the profit of small and medium enterprises with low raw material inventory will be greatly affected, and the profit margin will be low, so the phenomenon of limited production and stop production is common in small and medium-sized enterprises.

Industry adjustment has made "order to large enterprises", which has improved the right of speaking of large leading enterprises and the right to choose high-quality orders.