Shenzhou International Capacity Construction Is Getting Better And Better To Accelerate The Integration Of Space.

CITIC Securities released a report that maintained Shenzhou International (02313) "buy" rating, the target price rose to HK $125. The company believes that the company is a leader in vertically integrated garment manufacturing. It is expected that in the next 5 years, it will enter the stage of accelerated growth in productivity and look for its long-term and steady growth.

The bank said that after the Shenzhou International Vietnam and Kampuchea factory investigation, the company got the latest situation: Vietnam, the fabric steadily expanded, and the two phase of the garment climbing rhythm exceeded expectations. The two phase of Vietnamese garments was put into operation in the second quarter of 2019, and the three Adidas special factory is expected to start hiring after the Spring Festival in 2021. In Kampuchea, the first phase of rapid growth, the two phase of construction is smooth. Kampuchea 18 thousand people's new capacity plant and civil engineering projects have gone smoothly. It is expected that part of the recruitment and commissioning will start in the second quarter of 2020. On the whole, the company will build capacity and climb up from 2019 to 2020. From 2021 to 2022, the capacity harvest period will gradually increase.

In addition, the bank believes that Shenzhou International has two barriers. First of all, the advantage of capacity layout, because the company has a large-scale and efficient quality plant, it is enough to resist domestic land, labor costs and other problems to expand the resistance. The Chinese market is still the fastest growing region of global sports brands, so the company has the ability to give priority to the continuous growth of global brand customers in China in the future. Second, customer advantage. The company has the advantage of first serve to win the best sports brand customers in the world, but there is no large-scale brand order to cultivate new industry users.

The bank expects the company's 2019-2021 annual output growth to be around 10% /12%-13%/14%-15%, and the net profit growth rate of 2019-2021 years is 18%.