Textile Industry Is An Investment Industry Worthy Of Attention In The Second Half Of 2014.

　　 Industry investment logic

We expect the second half of the year. Textile and garment industry Production, exports, domestic sales, investment, profits and scale have maintained growth, and the efficiency of the industry has been improved. It is expected that the export growth rate will not exceed the same period last year, and the slowing down of domestic sales growth will continue.

Textile sub industry level, expected Raw material Market The price is weak, and the production and sales of leading enterprises are growing steadily. The quality and efficiency of the enterprises are basically stable. In the short and medium term, the leading enterprises of cotton textile industry have the value of allocation investment. In the medium and long term, with the adjustment of the cotton policy, the cotton textile industry is expected to usher in favorable opportunities, and the leading enterprises will benefit.

　　 clothing At the sub industry level, under the environment of segmentation of consumption, narrowing of consumer groups and fragmentation of demand, the traditional channels, marketing and production modes of industries are faced with many challenges. The deep transformation of industry is the general trend. The differentiation of stocks will become more obvious. Moreover, when the industry's future development path is not very clear, the emerging enterprises will rise rapidly.

Notable investment opportunities in the second half of 2014 include: policies related to cotton spinning industry and obvious differentiation of clothing stocks.

Cotton policy: Xinjiang cotton target price subsidy pilot started, reserve cotton sales to make adjustments, Anhui province first put lint and veil into the pilot range of approved value-added tax of agricultural products. The future cotton textile industry's policies are expected to become clearer, and pay attention to the price changes of raw material market after the new cotton market in September.

The trend of differentiation will be more obvious: the domestic market as a whole has no obvious improvement, but shows a trend of structural differentiation: it is expected that the growth rate of rural consumer goods market will continue to rise, but the growth rate of urban market will continue to slow down. The online shopping channels are still growing at a high speed, but the growth of physical channels will continue to slow down. The overall market downturn, but new consumer demand and expectations are constantly emerging. It is expected that the differentiation trend of the profit of garment stocks will be more obvious in the future: in the deep transition period of the industry, more consumer blind spots and business opportunities will be breeds, such as double eleven, balance treasure and WeChat red envelopes. The traditional clothing retail brands have lagged behind and mismatched the different demands in the grasp and satisfaction of such new demands, and the enterprises will have a more obvious differentiation, including profit differentiation, in response to the different rhythm and intensity of the new changes.

　　 Week industry operation is relatively dull.

The overall performance of the plate is relatively flat. Last week it dropped slightly by 0.30%. It outperformed the market, showing a certain degree of defensiveness. Most of the top ups and downs were more market-oriented innovative enterprises, such as Mei Sheng culture, Pathfinder, and Hai Lan's home.

From the valuation level, the current PE valuation level of textile and garment sector is 14.63 times, corresponding to the 14 year forecast of net profit growth rate of 13.37%.

Last week, the General Administration of Customs released the export data in May, and the export volume of textiles and garments increased by 8.70% year-on-year, which is consistent with our judgement of "sustained weak recovery". The latest statistics of domestic consumption demand show that domestic consumption has not yet shown signs of improvement.

Cotton prices continued to drop slightly last week. Cotton prices in the first quarter, the first quarter of 2014, April and May decreased by 10.95%, 0.63%, 9.67% and 0.45% respectively from 2014 to May. Since April, the cotton subsidy policy has a significant impact on the decline in cotton prices.