Stable Performance Of Textile Industry In 2019 And Challenges In 2020

Investment points

2019 in the whole year, the SW spinning and weaving section lost the Shanghai and Shenzhen 300. The 2020Q1 market and the textile and garment sector were all seriously affected by the drop in line consumption, but the textile and garment sector fell less than the Shanghai and Shenzhen 300. In 2019 and 2020Q1, the Shanghai and Shenzhen 300 index rose by 36.07% and 10.02% respectively, while the SW textile and garment sector rose 7.09% and 3.62% respectively.

Sub industry performance differentiation is obvious, women's wear, men's wear growth decline significantly, children's clothing, new retail boom is relatively high, home textile plate revenue remained stable.

(1) children's wear plate 2019 total revenue / net profit of 222/17 billion yuan, an increase of 21%/-11% over the same period last year. (2) the total sales revenue of women's wear plate is 2019 billion yuan, which is 103/4 billion yuan, up 7% from 12%/. (3) the total revenue of the men's wear sector is 2019 yuan, and the net profit is 317/41 billion yuan, an increase of 12%/-6% over the same period last year. (4) home textiles total revenue / net profit of 133/15 billion yuan, up 4%/0.5% over the same period last year. (5) the total revenue / net profit of new retail sector is 245/-13 billion yuan, down by 176% compared with the same period last year, mainly due to the loss of cross-border companies during the year. "(9%/) (6) the total revenue of the textile manufacturing sector / net profit is 289/17 billion yuan, up by 6%/ compared with the same period last year, down 17%.

2020Q1 textile and garment sector achieved a total revenue of 24 billion 800 million yuan, minus 23.68%. Other sub sectors saw textile manufacturing / home textiles / men's wear / women's wear / children's wear / new retail sales to achieve 49 /28/86/24/48/61 billion yuan respectively, representing an increase of -27%/-20%/-33%/-19%/-32%/-7% over the same period last year.

The net profit of the 2020Q1 textile and garment board dropped significantly, and the net profit in the single quarter was 1 billion 400 million yuan, down 57% compared with the same period last year. From the perspective of molecular plates, textile manufacturing / home textiles / men's wear / women's wear / children's wear / new retail businesses realized net profit of 1.44/3.59/16.63/4/4.4/3.9 billion yuan respectively, down by 71%/ compared with the same period last year, 39%/ decreased, 77%/ increased, 11%/ decreased, 89%/ dropped by 25%.

Industry view: (1) in the short term, the epidemic has a great influence on textile and clothing. In the long run, we recommend the local fashion and Semir costumes. (1) brand clothing: with the gradual improvement of domestic epidemic situation, the two quarter of brand apparel has begun to improve, and most of the enterprises' offline sales can return to over 50% last year. (2) textile manufacturing: with the expansion of oversea epidemic situation, the order of overseas orders has begun to take place, and the future losses are not well predicted. After the crisis, the market share of leading cities will rise. From a medium to long term perspective, we recommend the leading industry group, the current export value of cotton socks accounted for only 2.5%.

Risk warning: the epidemic continues to deteriorate, consumption is less than expected, and the international trade environment has changed drastically.