Haitong Securities - Textile And Clothing Industry In Depth Report

Abstract of the Research Report:

In 20h1, the median growth rate of textile and clothing income and net profit attributable to the parent company was - 18% and - 42% respectively. Among the enterprises in SW textile and garment industry, 76 and 65 companies had a year-on-year decline in revenue and net profit attributable to the parent company, accounting for 82% and 69% of the total number of Companies in the board. From the perspective of the median growth rate, the median growth rate of SW textile and clothing income and net profit attributable to the parent company were - 18.1% and - 42.1%, respectively, of which the median growth rates of SW textile manufacturing income and parent net profit were - 19.1%, - 25.5% and - 18.5% and - 54.4% respectively.

Leisure clothing: the epidemic affects the income pressure, and the online prosperity is good. The revenue of 20h1 leisure clothing sector was 17.49 billion yuan, a decrease of 22.5%, and the net profit attributable to the parent was 1.2 billion yuan, a decrease of 60.7%. The revenue of 20q2 leisure clothing sector was 9.32 billion yuan, a year-on-year decrease of 10.2%, and the net profit attributable to the parent was 0.83 billion yuan, with a year-on-year decrease of 40.5%. Under the influence of the epidemic situation, the income of online clothing and offline clothing of Taiping was increased by 20.0% and 20.6% respectively. The gross profit rate of 20q2 plate was 46.5%, with a year-on-year increase of 1.5pct and a net profit rate of 8.9%, a year-on-year decrease of 4.5pct. We believe that the main reason is the decline of offline retail business during the epidemic period, and the expenses of offline stores are fixed expenses, including rental fees and employee compensation. The sales expense rate has increased by 1.5pct to 21.7% year-on-year, and the management + R & D expense rate is the same 5 to 8.7%.

Women's wear: La chapel affected the profitability of the plate, and the revenue of 20h1 decreased by 32%. The revenue of 20h1 plate was 6.85 billion yuan, with a decrease of 32.4%. The net profit attributable to the parent company was - 0.6 billion yuan, with a decrease of 118.7%, and the gross profit rate was 57.3%, with a year-on-year decrease of 6.1 PCT and a net interest rate of - 0.9%, and a year-on-year decrease of 4.3 PCT. Plate income and net profit attributable to the parent decreased year on year, mainly affected by La charbelle. Excluding this factor, the growth rates were - 12.5% and - 22.9% respectively. The revenue of 20q2 plate was 3.27 billion yuan, with a year-on-year decrease of 28.8%. The net profit attributable to the parent company was - 160 million yuan, and that of 19q2 was - 120 million yuan. The growth rate of income side was better than that of net profit side. As the gross profit rate of 20q2 decreased from 7.9 PCT to 57.4%, the net interest rate was - 4.9%, which decreased by 2.3 PCT year on year. The decrease in net interest rate was narrower than that in gross profit margin, mainly due to the decrease of sales, management + R & D expenses rate by 9.6 and 2.8 PCT to 43.6% and 7.1% respectively.

Men's wear: 20q2 revenue increased by 7%, reasonable control of expenses is good for net profit. The 20h1 men's clothing sector realized revenue and net profit attributable to the parent company of 4.62 billion yuan and 510 million yuan, with the same decrease of 11.0% and 30.9%. The growth rate of the income side was better than that of the net profit side, mainly due to a year-on-year decrease of 1.5pct in 20h1 to 53.8%. In 20q2, the income of men's wear increased by 7.4%, and the net profit attributable to the parent increased by 115.2%. The growth rate of the net profit side was better than that of the income side. As the sales, management and R & D expense rates decreased by 4.7 and 1.6 PCT to 33.1% and 11.9% respectively, the gross profit rate of 20q2 was 55.3%, with a year-on-year decrease of 3.0 PCT and a net interest rate of 13.8%, which increased by 6.9 PCT on a year-on-year basis.

Manufacturing: revenue decreased by 18% in 20q2. In the manufacturing sector of 20h1, the revenue decreased by 20.2%, the net profit attributable to the parent company decreased by 49.1%, and the gross profit margin was 14.9%, with a year-on-year decrease of 3.7pct and a net interest rate of 5.1%, with a year-on-year decrease of 2.9pct. The revenue of manufacturing sector in 20q2 was 10.92 billion yuan, a decrease of 17.6%, which was higher than the growth rate (- 22.9%) of 20q1; the net profit attributable to parent company was 470 million yuan, with a decrease of 58.1%, which was slower than that of 20q1 (- 38.5%). The gross profit rate of 20q2 was 13.3%, a year-on-year decrease of 6.1 PCT. Due to the shutdown of the factory during the epidemic period, but depreciation, amortization and other fixed expenses were withdrawn as usual, the gross profit rate decreased by 4.4% and the net profit rate decreased by 4.2 PCT year on year. The fluctuation of 20q2 exchange rate was relatively stable, which was good for net profit. The RMB 20q2 was basically flat against the US dollar (middle price), and the fluctuation range was lower than 19q2 (0.4%).

Home textile: gross profit rate and net profit rate of 20q2 increased year on year. In 20h1, the revenue of home textile sector was 5.06 billion yuan, with a decrease of 11.5%. The net profit attributable to the parent company was 480 million yuan, with a decrease of 18.0%. The gross profit rate was 43.9%, with a year-on-year increase of 0.8 PCT and a net interest rate of 9.4%, with a year-on-year decrease of 0.7 PCT. The revenue of 20q2 home textile sector was 2.81 billion yuan, a year-on-year decrease of 2.9%. The net profit attributable to the parent company was 260 million yuan, with a year-on-year increase of 15.7%. The gross profit margin was 43.8%, with a year-on-year increase of 0.2 PCT and a net interest rate of 9.1%, and a year-on-year increase of 1.5 PCT, which was mainly due to the decrease of sales expense rate, management + R & D expense utilization rate and financial expense by 2.5, 0.2 and 0.4 PCT to 23.5%, 8.2% and - 0.5%.

E-commerce: 20q2 gross profit margin improved. The revenue of the 20h1 e-commerce sector was 20.53 billion yuan, up 13.8% with the same period. The net profit attributable to the parent company was 1.15 billion yuan, with a decrease of 18.0%. The gross profit rate of 20h1 was 40.6%, with a year-on-year decrease of 0.3 PCT and net interest rate of 5.6%, with a year-on-year decrease of 2.2 PCT. The revenue of 20q2 e-commerce sector was 10.49 billion yuan, with a year-on-year increase of 13.4%. The net profit of 20q2 attributable to its parent company was 740 million yuan, with a year-on-year decrease of 14.2%, gross profit margin of 45.8%, and a year-on-year increase of 5.2 PCT and a net interest rate of 7.0%, and a decrease of 2.3 PCT. with the increase of gross profit rate, the net profit rate decreased, mainly due to the sales, management + R & D and financial expense rates of 30.1%, 5.8% and 0.6% respectively, which increased by 4.6, 1.2 and 1.2 PCT year-on-year.

Investment strategy. At present, the epidemic peak in China has passed, and the retail terminals that were shut down in the early stage have been restarted. However, it still takes time for the passenger flow to recover. There is a risk of overseas illness and entry. Various major platforms have organized e-commerce festivals one after another, and the discount of commodities is relatively large. Consumers may prefer to choose online consumption. Some textile and clothing companies have good e-commerce operation ability, and the online development is smooth during the epidemic period. It is suggested to pay attention to anzheng fashion, Antarctic e-commerce and Saturday. At the same time, it is recommended to pay attention to the high-quality brands with excellent quality and strong brand power, and have the opportunity to benefit from the rebound of domestic demand, such as Anta sports, Dishu fashion, taobo and bienlefen.

Risk tips. The retail environment is weak, the industry competition is intensified, the price of raw materials fluctuates, and the exchange rate fluctuates.