Jiangnan Cloth: Simple Clothes, Not Simple Tickets.

Perhaps, classical things are like this. They will not be too mixed. This is also the reason why many years have passed.

A new list of Hong Kong stocks will be released in August 10th. From July last year to June this year, the target of closing the market value of HK $5 billion per month will be incorporated into Hong Kong stocks.

Over the past year, the outstanding performance of Jiangnan Buyi will also become the potential target of this target.

Although the current price is not cheap, the fundamentals of the company have not changed, and this time it will be included in the Hong Kong stock market. It is worth paying attention again.

The clothing companies that stand out

Since the emergence of Taobao and the rapid development of the electricity supplier, the economic effect of Hongbo has increased, and the clothing sales of traditional channels are basically dead.

Here is not enumerated, usually in the mall to walk around a circle can see a lot of people, shopping a lot of people, queuing to eat a lot of people, few shops, especially clothing.

Now we all choose to buy clothes online, which is convenient and optional. Secondly, it is cheaper than buying shops.

It is in such an environment that Jiangnan cloth clothing stands out, and the trend is no less than a technology Bull Stock.

Jiangnan cloth dress was founded in Hangzhou in 1994. The founder Li Lin is very different from other fashion brands. She is neither a fashion designer nor an art major. In the 90s of last century, when she was doing chemical experiments on the university campus, she herself could not have imagined that she could engage in a fashion related affair in the future and deal with colors and fabrics every day.

At first, it was only a small shop in Hangzhou. Later, business grew slowly, and Li Lin set up his own brand until it was listed.

But never forget the original mind, still starting from the product, insist on doing their own design, adhere to the original.

Some talents, together with chemical knowledge that can be applied to fabrics, let Jiangnan cloth go to today and become the designer brand with the highest market share in China, and this is fate arrangement.

At present, there are 8 brands, namely JNBY (women's wear), CRUQUIS (men's wear), JNBY by JNBY (children's wear), less (women's wear), Pomme de terre (teenager), JNBY HOME (household goods), and the new men's brand new brand launched in April this year, and the environmental protection brand launched in June has become a multi brand matrix.

From the above picture, we can see that the design of Jiangnan Buyi all follows the design concept of "avenue to Jane".

There is no excessive color impact, whether children's clothing or women's wear or men's wear, are the colors of the introduction, and no exaggeration or bling bling's cumbersome.

Perhaps, classical things are like this. They will not be too mixed. This is also the reason why many years have passed.

Looking back, the old brand of the pink girl was shot dead on the fashionable beach.

As of December 31, 2017, there were 1768 stores in the south of the Yangtze River, 40 of which were located in Hong Kong, Macao, Taiwan and overseas.

As we all know, the Hong Kong stock market is not storytelling, so the rise of cloth in the south of the Yangtze River is not speculation.

From the -2017 fiscal year of 2014, the performance and net profit of Jiangnan cloth were steadily increasing. In the first half of fiscal year 2018, the income was HK $1 billion 981 million, and net profit exceeded the full year of fiscal year 2017.

Gross profit margin has remained above 60% in recent years, and net profit margin 2018H1 has gone to 18.9%.

Two, solid management and business strategy.

Many clothing companies also have many sub brands, some of which seem to be growing every year, but in fact they are driven by one or two new or classic brands, or the growth of revenue generated by the rapid opening of stores.

However, there are different aspects in the south of the Yangtze River.

According to the latest 2018 fiscal year H1 data, every brand in Jiangnan cloth clothing has been growing, not the overall pull brought by the increase of classic or new brand.

Unlike many traditional clothing brands, Jiangnan cloth has no high dependence on Tmall, Jingdong and other e-commerce platforms. It has not blindly pursued the sale of electronic business, but has used it as a channel for supporting sales and consumer interaction.

Jiangnan Buyi launched the WeChat service platform in 2015, focusing more on the operation of WeChat platform, and attaches great importance to its membership management.

Driven by the economic strategy of fans, the H1 retail stores in fiscal year 2018 increased by 10.3% compared with the same store. The retail sales contributed by the members accounted for 67.4% of the total retail sales in the south of the Yangtze River. As of December 31, 2017, there were 2 million 400 thousand online channel members, including 1 million 900 thousand WeChat accounts, an increase of 500 thousand over the same period last year.

In 2017, active members, that is, 290 thousand members who consumed 2 or more consumption within 180 consecutive days in one year, increased 60 thousand over the same period last year.

Thanks to the carefully maintained fans, the growth of online channels is obvious, and H1 in the 2018 fiscal year increased by 73.1% over the same period.

Despite the brand growth of two new brands this year, Jiangnan cloth has only one brand in the past, and only one of the six brands is men's clothing brand, that is, sketch.

If you open the first chart of this part, you can see that the growth rate of H1 in the 2018 fiscal year is 19.5%, but in the 2017 fiscal year, the growth rate of the sketch is 28%, so the growth rate of 2018H1 is somewhat slower.

At this time, Jiangnan cloth Yi launched second.

Brand, SAMO, on the one hand, balances the gender structure of its brand, and on the other hand alleviates the slowdown brought about by the sketch.

In fact, the management strategy is very timely and prudent.

On the other hand, management has a clear understanding of brand positioning and understanding.

At the beginning of this year, when the author participated in their performance meetings, some analysts asked why, as a designer brand, Jiangnan cloth clothes did not open stores in the fashionable capital of Europe, such as Paris or Italy, but in a remote small country.

The management of Jiangnan cloth said that although Jiangnan cloth is positioned as designer brand, it is still not enough to tell the truth in these places of fashion capital. It can be said that in the face of brand branding abroad, the aim is to make money in earnest.

The understanding of this is that many domestic brands are hard to understand.

Three, designer brand industry situation

Jiangnan Buyi is different from the fast selling clothing brands listed in the Hong Kong stock market, such as Sijie globe and Giordano. It takes the designer's brand line, and the designer's brand is characterized by a high degree of identification.

It is not like a sportswear or luxury goods. It can be identified by a logo. Generally you see its design, version, you know what the brand is.

Generally, they all have strong designer characteristics and iconic style, which is one aspect of consumers' attention nowadays.

For example, Phllip Lim, Alexander Wang, Chictopia, etc., are generally named after the designer, and can strongly reflect the designer's personal style.

According to the CIC consultation report, from 2013 to 2017, the designer's brand segmentation market capacity increased from 1 billion 800 million yuan to 4 billion 490 million yuan, which accords with the annual growth rate of 25.7%. The volume of market volume from 2018 to 2022 is expected to increase from 5 billion 680 million yuan to 13 billion 460 million yuan, and the compound annual growth rate is 24.5%, far exceeding the overall growth level of the clothing industry.

The domestic designer brand market competition pattern is scattered, the designer brand of scale is still in the minority, and many of them are not designer brands, especially those of Taobao. Basically, they are plagiarized. What original designs are designed according to some foreign brands.

At present, the market share of Jiangnan cloth clothing has reached 9.6%, the industry's first, occupies the absolute scale superiority, and compared to the designer brand, the price positioning of Jiangnan cloth clothing is reasonable.

At present, most of the designer brands in the industry are still constrained by the constraints of channels, funds and scale. It is difficult to develop. It is very expensive to make art. The designer brand takes art as the starting point. Jiangnan cloth is a brand originated from art but linked with art.

epilogue

Jiangnan Buyi is different from other clothing enterprises. In the past, the following six brands have achieved double-digit growth every year, and they are not too dependent on the growth of new stores. The same store sales also have double-digit soar, which is a very valuable performance as a traditional clothing brand.

On the other hand, Jiangnan cloth clothing has increased two brands this year, and is worth looking forward to in the 2018 fiscal year.

With the exception of management in strategy and self brand recognition, it is also a very important point for the company's fundamentals to add extra points.

Buffett once said that many of the companies he bought were in.

Extremely intense companies, he bet on such companies is entirely due to excellent management.

At present, the valuation is not cheap at all. 18 times PE is less than 10 times PE when it was written in August last year, but based on the invariable fundamentals of investment logic, excellent management and the inclusion of Hong Kong stocks, the company can still maintain its concern.