Textile And Apparel: Focus On Quality Subdivision Track Selection, Undervalue Brand Leader

In May, the textile and garment sector fell by 7.14%, 0.51 points in the big market, the SW textile index dropped by 7.14% in May, and 0.51 points in the overall market. Textile manufacturing dropped by 8.16%, and apparel home textiles decreased by 6.59%.

Judging from the annual market changes, as of May 31st, the SW textile and apparel index rose 9.53% overall, the running loss index of 7.82 points, of which the textile manufacturing sector rose 10.68%, and the apparel home textile rose 9.03%, running 6.67 and 8.23 points respectively.

First, long-term advantages of leading enterprises

Under the background of aggravating trade disputes, domestic textile manufacturers will inevitably be directly affected by tariff policies, but the leading manufacturers are expected to avoid tariff effects to the maximum extent through the existing and accelerating overseas production capacity layout. From the data, we have also seen that the export of US data to Southeast Asia and other countries has increased significantly since the textile export data of the United States declined significantly this year.

Through the investment layout of Southeast Asian countries over the past few years, domestic manufacturing leaders have made full use of their advantages such as low price labor force, raw materials, trade preferences and so on to accelerate their consolidation, and trade disputes are expected to be a catalyst for concentration.

Two, investment strategy

Plate fundamentals, on the one hand, since March this year, the industry and key companies data have a certain marginal improvement trend, with the promotion of consumption and tax reduction and other policies landing in the future, it is expected that the second quarter of the industry fundamentals will be sustained after the elimination of the high base number.

On the other hand, there is a clear differentiation between industries in the low period of subdivision, and the quality track enterprises that are in line with the current consumption trend still have a relatively good growth rate. At the same time, the performance of leading companies in the context of their own operation optimization is also better than the average level of the industry.

For this, we suggest: first, actively layout in the high quality track, and at the same time have the ability to concentrate on upgrading the growth of enterprises.

Since the second half of last year, although the industry has experienced the impact of poor retail environment, but the quality of cosmetics, children's clothing and sporting goods and other quality segments of the industry has achieved sustained high growth, it is recommended to focus on the beauty of the leading beauty and the children's wear faucet Semir (002563); two, the fundamentals have more obvious changes in the near future brand leader, stock price pre adjustment is relatively full, business stability, but dynamic valuation is at the bottom of the historical interval, the future is expected to achieve value recovery in the process of gradual recovery of the basic, focusing on the singer (603808) and Hai Lan's home (600398).

Risk warning.

Consumption expectations are uncertain, and the industry boom has continued to decline.