Cotton Planting Area Is Decreasing, Cotton Enterprises Are Expected To Benefit

Weekly market review and views

Last week, Shanghai Composite Index, Shenzhen stock index and Shanghai and Shenzhen 300 rose 7.25%, up 7.09% and 7.60% respectively.

The textile and garment sector rose 9.21%, of which the textile sector rose 9.49% and the clothing sector rose 8.97%.

In terms of stocks, Shandong's Ruyi, maishin culture and phoenix bamboo textiles are among the top gainers. Semir's clothing, search, and leading shares are among the top.

According to the statistics of the China National Business Information Center, there are hundreds of major retail enterprises nationwide in 1-2 2015.

Retail sales of commodities increased by 6.4% over the same period last year, and the growth rate was 7.7 percentage points higher than the same period in 2014.

Affected by a relatively low base in the same period last year, the volume of retail sales of all types of clothing in the major retail enterprises nationwide increased by 7.9% over the same period of 1-2, representing a 13.2 percentage point increase over the same period last year.

Recently, the Xinjiang autonomous region issued the circular on conscientiously doing the work of reducing the planting area of Xinjiang cotton flower. The latest cotton planting information survey published by China cotton information network also showed that the cotton planting area in 2015 decreased by 20% over the same period last year.

Among them, Xinjiang's year-on-year decrease of 11%, and the mainland's year-on-year decrease of 33%.

However, the expected reduction in planting area has not greatly boosted the current market price for the week.

Similar to the reduction in domestic production, the area of cotton planting abroad in the United States and Australia is also declining.

The drop in cotton planting area is a support for cotton prices. In March, textile enterprises made up for inventory in the summer season, making short term cotton prices expected to rebound. Cotton textile enterprises are expected to benefit from it. They are concerned about Lu Tai A, Huafu color spinning and Baron East.

News dynamics of industry companies

Zara's parent company Inditex will reward employees in the form of cash dividends; Lining lost 781 million yuan in 2014, narrowing by 48% annually; Nike's global order growth continued to be weak, and greater China became the biggest growth area; Parkson entered the catering industry and vigorously responded to department stores' dilemma.

First quarter earnings forecast net profit fell 60-90% compared to the same period last year; Weixing shares were re identified as high-tech enterprises; Wenzhou International Investment Bank of civil and Commercial Bank of China was approved by the banking regulatory authority (CBRC); and the AOKANG international investment bank was approved by the CBRC.

The purchase of Yi hang world equity; Shanghai Jahwa annual report increased by 19%, net profit increased by 12%, 10 sent 6.1 yuan, the draft of the employee stock ownership plan involves about 150 thousand shares of stock; resignation of the deputy general manager of the group; the annual income of aviation shares is +8.65% year-on-year, net profit is +8.21%, EPS0.7 yuan, 10 yuan to 2.1 yuan;

Annual report, revenue +12%, net profit +21%, EPS1.63 yuan, 10 yuan to 10 yuan to 10 shares.

Industry data aggregation

328 grade cotton spot 13448 yuan / ton (-0.13%); American cotton CotlookA69.65 cents / pound (2.13%); viscose staple fiber 11380 yuan / ton (0.09%); polyester staple fiber 7083 yuan / ton (-3.41%); long staple cotton 27700 yuan / ton (0.36%); inside and outside cotton price difference -143 yuan / ton (-533.33%).