Textile Industry Consolidation Speeds Up &Nbsp; Cost Pressure Remains To Be Alleviated.

The situation of foreign trade is low and the cost of raw materials has increased. Since 2011, the textile and garment industry has been hit hard.

Industry integration continues to accelerate

Textile and silk were once the traditional dominant industries, but poor performance increased the determination of all shareholders.

The Jiangsu property exchange April 18th announcement shows that the Jiangsu Xintian Group Development Co., Ltd. of Jiangsu SOHO Holding Group Co., Ltd. offers a price of 14 million 194 thousand and 200 yuan, and intends to make the total amount of 10 million yuan invested by Jiangsu Yulun Textile Group Co., Ltd., that is, 20% of the registered capital of Bede Sai.

The poor performance of Yulun textile increased the "intention" of SOHO holdings.

According to public information, Yulun textile mainly produces four series of yarn and poplin, such as pure cotton, chemical fiber, blended spinning and air spinning, but because of its poor management, since March 2011, it has repeatedly auctioned looms, warping machines, winding machines, roving machines and other textile equipment.

According to the audit report, Yulun textile realized business income of 92 million 457 thousand and 200 yuan in 2011, with a net profit of -29.97 million yuan and a total assets of 422 million yuan in 1-5 months.

Compared with the 10 million yuan contribution, SOHO's premium to Yulun textile is 42%.

However, Yulun textile management still has confidence in the company. Zhu Jinan, the company's legal representative, has clearly indicated that he will exercise the priority of pferee and participate in the acquisition.

But the other 4 shareholders gave up the priority right of assignee.

At the same time, 25.71% state-owned shares of Shijiazhuang Textile Machinery Co., Ltd. are also listed in the Hebei property rights trading center.

The textile machinery company undertakes the management of equipment manufacturing and many textile equipment factories in Shijiazhuang, but as of November 30, 2011, the total assets of Shijiazhuang spinning machinery company amounted to 101 million yuan, with net assets of only 30 million 300 thousand yuan.

The pfer target corresponds to a net asset assessment of 8 million 790 thousand and 300 yuan and a pfer base price of 9 million yuan.

According to the exchange information, equity trading in textile companies on the property market is increasing.

COFCO has recently sold 10% stake in Beijing Xinli Wool Textile Co., Ltd.

Cost pressures remain to be eased.

The rising cost of raw materials and labor, as well as the downturn in foreign trade and the appreciation of the renminbi are the main reasons for the continued failure of the chemical fiber and textile industry.

In the first quarter results report or notice issued, Chinese clothing,

Chinese clothing is expected to lose 7 million 500 thousand to 8 million 500 thousand yuan in 1-3 months, while the company had a profit of 305 thousand and 300 yuan last year.

Chinese clothing said that the first two quarter of 2012, the international and domestic market demand was sluggish, leading to the company's export business failed to achieve the desired goal.

As domestic raw materials prices and labor costs rise, coupled with the appreciation of the renminbi, so that the gross profit margin of the company's exports declined.

The performance of the listed companies of textile and garment sector is worrying.

Data show that the gross margin of sales of textile and apparel companies which has announced the first quarter results has been significantly reduced, of which ST Maya, San lane and meinda are down 72.52%, 59.64% and 45.83% respectively, although the gross profit margin of a few companies such as Sha Sha shares has risen, but the increase is not more than 16.5%.

Insiders say that the low price of products and the rising cost of raw materials have constituted a double attack on the plate profits.

Changshan shares said that in the first quarter, the market situation of the cotton textile industry continued to be weak, and the price of cotton textile products was greatly reduced compared with the same period last year. The gross profit margin dropped sharply, resulting in a large loss.

The industry believes that the textile sector's performance needs to wait for cost pressures to ease and the global economy to pick up.