Textile And Garment Tax Rebate Is Difficult To Appreciate.

Gao Hucheng, Vice Minister of Commerce, said recently that the implementation of the export tax rebate rate for textile and garment products will not be implemented for a long time. After studying the effect of relevant measures, we will further study whether there is room for further increase.

This news has brought a little vitality to the textile and garment sector again.

Textile and garment export tax rebate rate up 2% of the "rescue strategy" has been implemented for a month, but for many people, the continuation of the problem is still "where is spring?"

"Because of the continued appreciation of the renminbi and rising domestic costs, the tax rebate of two percentage points can only be said to have slightly enhanced industry confidence."

The person in charge of a textile trading company in Shanghai told reporters.

Another researcher pointed out that the move is purely "a stalling tactic in the trend of industrial upgrading", and many small and medium-sized enterprises have been pulled back from the edge of the exit, which is not conducive to the development of the dominant enterprises.

"For the industry, the substantive impact is not big, and it has little impact on the textile and garment sector in the capital market."

These people told reporters.

Under the influence of a pivotal factor in the appreciation of RMB, the mechanism of stock selection in textile and garment sector has become a trend of "internal (domestic oriented brand enterprises") and "external (export oriented)".

The impact of the tax rebate on micro policies and the announcement from various listed companies can also be seen.

The A (000726.SZ) announcement, which is considered to be the most benefited, said, "the company's financial sector will increase the total profit of about 21 million 80 thousand yuan in this year according to the import and export plan of the month of 2008 in 8-12."

In addition, 002083.SZ gained half a year's profit of 15 million and Jin Feida (002239.SZ) also benefited from 4 million to 5 million.

However, a number of listed companies such as 600483.SH, 600156.SH and Kaiyuan (600981.SH) of Fujian have announced that tax rebate adjustment has little effect on Jiangsu.

The brand clothing enterprises, including YOUNGOR (600177.SH), 002029.SZ, and other domestic brands, are basically unaffected.

The CITIC investment research report estimates that the adjustment will increase the total profit of the textile industry by US $2 billion 600 million. According to the exchange rate of US dollar to 6.82 yuan, the profit will increase by about 17 billion 700 million yuan.

However, due to the relatively high dispersion of textile and garment enterprises, such a large amount of money scattered to a single level of listed companies, the impact is not obvious.

And the relevant plate index has not been greatly encouraged.

The textile and clothing sector index provided by great wisdom shows that the cumulative decline of the index has been 22.6% since August 1st, compared with a 16.96% decline in the same period.

According to the research report released by CICC, from the historical point of view, the correlation between the adjustment of export tax rebate rate and the change of plate index is not high.

However, the proportion of institutional investors in the textile and garment sector has increased, from 2.4% in early August to 2.7% at present.

Against the backdrop of RMB appreciation and weak foreign demand, it is almost impossible to hope that the export tax rebate will reverse the industry.

"Compared to the export tax rebate, the appreciation of the renminbi has brought us much more influence."

Lu Tai A securities affairs representative Zheng Weiyin told reporters.

In the first half of this year, the appreciation rate of RMB has reached 6.5%. In the first half of this year, the export volume of Ru Tai A was 210 million US dollars. If it did not take hedging measures such as hedging, its exchange loss would exceed RMB 80 million yuan.

However, due to the proper use of the hedging business, the exchange income of 99 million 900 thousand yuan in the first half of 2008 has completely covered the pressure of RMB appreciation, or even a slight surplus.

In this regard, Lu Tai A's financial expenses fell by 68.88% over the same period last year.

"The export tax rebate adjustment in August is still a little different from our previous expectations. Before the industry, it was widely assumed that the export tax rebates for clothing increased by 4 percentage points."

The person in charge of a textile trading company in Shanghai told reporters.

At the same time, since September 1st, India has also increased export tax rebates for some textiles, leather, cotton and other products, which has also been interpreted by some sectors as a "dark battle" between China and India.

The speculation that the relevant departments will raise the export tax rebate again is coming to life.

Guo Haiyan, a researcher at CICC, believes that the textile export tax rebate rate may have room for further improvement, "but policy decisions will be more prudent."

In her view, although the tax rebate rate of textile and clothing is only at a moderate level in various industries enjoying export tax rebate, "at present, the total export tax rebates granted to all industries by the state sector have accounted for 10.7% of China's fiscal revenue. The huge expenditures faced by post disaster reconstruction and the continuous increase in government subsidies for low-income groups brought by high inflation" are estimated to be more prudent in further raising the tax rebate rate.

What is more, it is considered that the adjustment of export tax rebate is only a "brake" of industrial upgrading, and "actually postpones the process of market selection."

Domestic sales are the leading export industries and brand clothing enterprises with their own channels and domestic sales.

Guo Haiyan, a researcher at CICC, said that under the background of the appreciation of the renminbi and the recession of major importing countries such as the United States, "we take a general look at the export related industries, and look at those domestic marketing enterprises that have their own brands and sales channels, which are less affected by the national fiscal policy and can expand their market scale through the upgrading of domestic consumption."

In their view, YOUNGOR and seven wolves are typical representatives of A shares; Lining and BELLE are typical representatives of H-shares.

"We dare not say this is our spring, but in this winter, it is easier for us to survive."

Yang Penghui, a seven wolf manager, told reporters.

Compared with YOUNGOR's diversification strategy, the seven wolves chose to make intensive efforts in the garment industry.

And the seven wolves in the terminal area to attack the city is also Yang Penghui's bottom line.

According to the company's semi annual report in 2008, there were 392 new terminals in the reporting period, representing an increase of about 20% compared with 1976 at the end of 2007.

"The company has a high brand awareness and a sound sales network, good financial condition, and benefited from the upgrading of consumption and the acceleration of urbanization."

Guotai Junan pointed out in his report.