Research Report On Textile And Garment Industry

Investment tips:

Cosmetics consumption continued to boom, clothing sales in the fourth quarter flat, warm winter impact is obvious. 1) retail sales of cosmetics continued to grow at a relatively high speed. In the past 19 years, the total retail sales of consumer goods increased by 8% over the same period last year, down 1PCT from the same period last year. Among them, the cumulative growth rate of cosmetics retail sales reached 12.6%, significantly better than other consumer goods. 2) under the influence of warm winter, the apparel retailing in the fourth quarter continues under pressure. Sales of clothing and footwear category increased by 2.9% over the past 19 years, down by 5.1pct compared with the same period last year. Affected by warm winter, clothing sales in the fourth quarter were obviously less than expected. In December, clothing and footwear category increased by 1.9% over the same month, down 5.5pct from the same period last year. 3) the growth rate of electricity providers has been steady. In the 19 years, the year-on-year growth rate of online retail sales of physical commodities was 19.5%, and the cumulative growth rate remained stable. But the direct seeding growth of direct seeding electricity providers is expected to reach 100 billion market in 19 years. The growth rate of Taobao is about 400%, and that of double eleven is 20 billion yuan. The outbreak of net red live goods has become a landmark event in the new consumption era. 4) the export volume has slowed down in 19 years and rebounded slightly in December. In the 19 years, the total export volume of China's textile and clothing decreased by 1.9% compared with the same period last year. The total export volume of textiles increased by 0.9% compared with the same period last year, and the total export volume of clothing decreased by 4% compared with the same period last year. In December, China's textile and clothing exports increased by 13.1%, an increase of 8% over the same period last year. 5) cotton prices have bottomed up. As of 20 February 4th, the cotton price index increased by 7% over the 328 quarter of the three quarter of 19. With the entry of cotton stores and the gap between supply and demand of cotton in 2020, the price is expected to rise steadily in the future.

In the fourth quarter of 2019, the apparel industry was dominated by public clothing, with the differentiation of high-end brands, and the rapid growth of the electricity suppliers and the high degree of prosperity of cosmetics. According to the disclosure of performance, from the sub industry perspective: 1) cosmetics quality companies are expected to stand out. Cosmetics are already red tape, and even one of the most popular categories of online sales. The overall electricity supplier flow has also been tilted to the category of cosmetics. The brand of Chinese goods has achieved the turn of the road through the new media marketing, and has successfully seized this round of industry dividends. 2) the leading edge of the electricity supplier continues to strengthen. Clothing category traffic growth slowed down, online sales pressure, but we think that meet the cost performance of domestic consumer demand for electricity is expected to accelerate growth. 3) clothing sales under pressure. The industry's overall pressure growth slowed down in the four quarter, and the fourth quarter was poor because of the warm winter weather. 4) textile manufacturing export demand is stable and domestic demand is weak. Overseas capacity expansion continued to push forward, while cotton textile exports grew at a steady pace in the fourth quarter, but domestic demand for clothing consumption was flat.

We expect the performance of key companies in the textile and garment industry in 2019 as follows: focusing on cosmetics, electricity providers and sports to maintain a high level of prosperity.

The growth rate is higher than or equal to 30% of the company mainly includes: Lining (89% growth rate, in line with expectations, brand strength, product strength and continuous growth of terminal sales); Anta sports (growth rate 34%, exceeding expectations, Anta main brand continued to grow two digits, FILA brand maintains high growth rate, multi brand matrix is perfect, store efficiency has been steadily improved), baby friendly room (44% growth rate is in line with expectations, 19 years of exhibition shop speed exceeding expectations, and gradually expand southwest Southern China and other regions, category high-end trend and independent brand ratio increase, further optimize profit level). Be Meleven (growth rate of 40%, in line with expectations, steady expansion of channel expansion, sustained two digit growth in business efficiency, and expected to continue to grow rapidly in the future); the growth rate of Antarctica is 40%, which is in line with the expected growth rate of GMV in the 19 years, nearly 50%, the dominant category concentration keeps rising, and so on. The growth rate is 36%. The growth rate is 36%, which is in line with the expectation. The new social media, the high speed growth of e-commerce channels, and the expansion of brand agents to cultivate new growth points are expected. In line with expectations, the main brand continued to upgrade, the channel structure gradually improved, the supply chain advantages were obvious, the fast reverse ratio was 60%, and the retail sales remained high in the warm winter situation. The growth rate of 33% was in line with expectations, B2C's own brand profitability improved rapidly, B2B's foundry business continued to find new growth points, and showed strong growth); Jenn Sheng group (31% growth rate, over expected production capacity, sustained release of overseas production capacity, gradual increase of seamless underwear products, driving profit margins continued upward), one network one creation (30% growth rate, in line with the expectation, helping the hundred Rex and OLAY complete the brand remolding, and reaching deep cooperation with transnational daily chemical giant Procter & Gamble, Amy, etc.), and the future is expected to maintain sustainable growth. Bosideng (33% increase)

增速在0-30%的公司主要包括：安正時尚(增速19%，符合預期，主品牌增長穩(wěn)健，其他品牌持續(xù)調(diào)整，線上快速增長);申洲國際(增速17%，符合預期，海外產(chǎn)能有序投放，未來三年有望迎來產(chǎn)能加速釋放期);水星家紡(增速17%，符合預期，線下持續(xù)拓展大店，加強品牌影響力，店效穩(wěn)步提升;電商業(yè)務經(jīng)歷調(diào)整復蘇強勁，預計全年增速有望達到兩位數(shù)以上);青松股份(增速16%，符合預期，公司化妝品業(yè)務穩(wěn)定增長，確定性強，化工業(yè)務盈利穩(wěn)健，目前市值低估);地素時尚(增速12%，符合預期，預計公司19年開店增長10%，疊加終端管理提升帶動同店增長，業(yè)績確定性強);歌力思(增速12%，符合預期，主品牌持續(xù)穩(wěn)健增長，收購品牌表現(xiàn)強勁，IRO等新品牌已進入業(yè)績釋放期);上海家化(增速11%，符合預期，多品牌運營積極調(diào)整，品牌發(fā)展分化，部分品牌還在調(diào)整中);森馬服飾(增速7%，符合 It is expected that endogenetic + extension will protect children's wear advantages and maintain high growth of electricity supplier channels. Hai Lan's home (3% growth rate) is in line with expectations. The main brand product strength of men's clothing continues to escalate, and the brand gradient of children's clothing business is formed, which is expected to contribute steadily to new income growth in 2020.

Industry perspective and investment advice: warm winter in the fourth quarter of 19 makes pressure on clothing sales in winter. Looking ahead to the first quarter, after the outbreak of the epidemic, sales under the brand line were under pressure, and the change of optional consumption became more obvious. The pressure in the first quarter continued. The cosmetics season in the second half of the year and the proportion of high electricity providers make it relatively less affected. Considering the insipid sales of clothing and the downgrading of the industry from "optimistic" to "neutral", we should continue to look at the high boom cosmetics and electricity suppliers, and suggest that we should pay attention to the undervalued clothing companies. Recommendation: 1) cosmetics industry chain high boom: song song share, pelera, PAMY shares; 2) high growth of electricity providers: Antarctic business, one network creation; 3) leading white horse: Anta sports, Lining, Hai Lan home, Semir apparel.