Leisure Wear Industry Enters "Adjustment Period"

As the two leading companies in the domestic casual wear industry, the US and Semir's every move has become the "weathervane" for the development of the whole industry.

Judging from the operation of the two enterprises in 2011, there are several trends. First, the domestic youth casual wear market has experienced rapid growth. At present, the impact of international fast fashion brands such as Zara, H&M, Uniqlo and so on is becoming more and more intense. The overall growth rate is slowing down. Last year, the inventory pressure was stronger and entered a stable adjustment period.

Two, under the adjustment trend of leisure wear business, it is inevitable to seek new growth points. Children's clothing has become a "meat and cake". Semir and Smith Barney are currently accelerating the development of children's clothing business.

Three, the extension, enrichment and fine adjustment of the product line are becoming more and more important. The United States continues to refine and enrich the brand series, and Semir continues to enhance the product's fashion and so on.

US bond: revenue 9 billion 945 million better stock index

A second line direct run to drive three or four line franchisees

At present, the company has more than 1000 Direct stores, accounting for about 30% of the total area, and its contribution income is about 40%-50%.

Direct stores are the windows of the brand promotion strategy (including store decoration, product display, new product listing, discount rhythm, information sharing, efficient logistics, etc.).

The way of channel management is replicated to the three or four line based on the successful mode of one line store.

Huatai Securities researcher Gao Guo pointed out that after the continuous adjustment of the early operation strategy, the speed of the shop opening was slowed down, and the existing stores had been nurturing, and the effective control of the cost was obvious to the net profit growth.

Its main outlets are mainly concentrated in the first tier core market, and the franchised stores are concentrated in the 234 line market. Currently, the number of Direct stores is nearly 20%.

As part of the adjustment of the channel strategy in 2010, the support for franchising channels increased, and the franchising business resumed rapidly. The first half of 2011 increased by 54.5% year-on-year, which was higher than that of the direct revenue growth.

Future Ltd will meet the needs of differentiated channels through products and brands, and dig deeper into the market space.

Huatai joint researcher Cheng Yuan, Zhang Lei and Feng Jing predict that the expansion speed of their channels will be stabilized at around 20% in the future.

Memory volume is expected to fall to a reasonable level.

During the reporting period, Smith Barney continued to increase product and brand innovation, continuously deepen product category and thematic operation, enhance brand image, enhance the terminal competitiveness of the company, and achieve rapid growth in both direct channel and affiliate channel sales.

Huatai Securities researcher Gao pointed out that in the first three quarters of 2011, the inventory was about 2 billion 980 million yuan, and the excessive inventory had a certain relationship with the company's sales scale and the proportion of direct battalion.

At present, we are actively integrating various promotional methods, such as new and old "integration" sales, 2000-3000 discount shop sales, and electronic channel sales.

At present, the stock index is gradually improving, and the inventory is expected to gradually decline. It is estimated that the current inventory is about 2 billion 500 million yuan, of which the goods accounted for about 60%-70% in 2011.

Huatai joint researcher Cheng Yuan, Zhang Lei and Feng Jing pointed out that the U.S. stock inventory has a good digestion trend. In the future, we will improve operational efficiency from products, stores and logistics, and reduce the backlog of goods from the source.

Through the opening of special stores, new and old products integration, and so on, the inventory has been gradually effective. It is estimated that the inventory will reach 2 billion 500 million yuan by the end of 2011, and the inventory will drop to a more reasonable level by the middle of 2012.

In order to avoid the backlog of inventory and promote new product sales, the company put together the product mix with the store type in the commodity planning section last year when preparing the autumn order meeting, and plans to add efficient logistics to the new product launch this year, so as to realize the weekly listing of new products and speed up the turnover of terminal goods, thereby improving the performance and reducing the backlog of inventory.

At present, the company has begun to try every week to launch new products, and the turnover rate of goods in stores has increased correspondingly, and the product price rate has also increased.

Galaxy Securities researcher Ma Li and Li Jiajia pointed out that the company increased its inventory clearance efforts in the second half of 2011. It is estimated that there will be about 300 new discount channels throughout the year. The total inventory is expected to be around 2 billion 500 million -26 billion yuan (including containers, packaging materials, etc.).

As the company's stock is mainly formed in the autumn and winter of 2010 and the spring and summer of 2011, it is expected that the inventory will be cleaned up in the first half of 2012, and the pattern of quarterly inventory and cash flow improvement will continue. The overall financial statements of the company will be clearer in 2012.

MC flat effect fast growth, Tagline and children's wear continue to advance.

After nearly two years of adjustment and development, the brand line and product line of Mei Bang are relatively abundant. Apart from the main brands MB and MC, MB has derived MooMoo, Tagline and other sub brands, and its product lines are divided into MTEE, MJeans, M.Polar and other series.

The Tagline series launched in 2011 is an extension of MB brand positioning, with a wider audience and a wider price band.

At present, it is mainly promoted in the first tier cities, and is rarely sold in separate stores. The expansion of future channels will be mainly based on the newly developed shopping malls and community stores in the second tier cities, and the number of individual stores will also increase.

At the same time, children's clothing business has also become a new expansion point.

Huatai joint researcher Cheng Yuan, Zhang Lei, Feng Jing pointed out that in 2011, its MC growth rate was faster than MB, and brand operation continued to improve. The MC loss is expected to be slightly higher than 50 million yuan this year, and the level of Ping MB is still a little higher than that of MB.

The poor performance of MC is mainly related to the fast speed of opening shop, but with the continuous improvement of product development, display of goods and supply chain management, MC business efficiency has been continuously improved.

The new series of Tagline jumped out of the original frame of the United States and positioned itself in a wider audience.

EPS is expected to be 1.21, 1.58, and 2.08 yuan in 2011-2013 years, respectively, to maintain the "buy" rating.

Huatai Securities researcher Gao pointed out that the company's products in recent years are becoming mature.

By the end of 2011, the brand of MB urban fashion series was upgraded, and Tagline was focused on publicity. In the future, independent brands would operate and set up independent stores.

In 2012, the new MB children's wear brand MooMoo is expected to make rapid progress through the huge sales network of Mei Bang adult wear.

MC through the store adjustment, the single store efficiency improvement is more obvious, will continue to promote MC-Kids children's wear to join, Future Ltd MC adult wear brand will also gradually open to join in business, in 2012, MC brand is expected to turn a profit.

The main driving force for the future development of the company is the growth of new brands, the extension of channels and the improvement of single store efficiency.

It is estimated that the net profit growth rate in 2012-2013 years will be 27.5% and 24%. EPS is 1.54 yuan and 1.91 yuan, giving 21 times PE and giving the "recommended" rating.