At the beginning of the 2022 new year, the sales of gold jewelry market recovered during the Spring Festival, and gold products ushered in a peak consumption. During the Spring Festival of the year of the tiger, the gold and jewelry industry ushered in a small consumption peak, and major brands and shopping malls also launched a series of promotional activities for the festival. In all categories, gold jewelry products are more popular with consumers. The strong sales of gold jewelry are mainly due to 1) the early Chinese New Year in 2022, and the impact of the epidemic in some areas in the early stage makes the consumer demand accumulate until the Spring Festival. 2) the year of the tiger itself belongs to the lunar new year, and the Lunar New Year gold jewelry is particularly popular; 3) The reduction in the proportion of local Chinese New Year celebrations in 2022 has also promoted the recovery of consumption to a certain extent.
The prosperity of China's jewelry industry is highly related to the overall prosperity of macro and consumption, and the annual growth of the industry tends to be stable. With the rapid economic growth, the jewelry industry has ushered in the high-speed growth period of "golden decade" since 2003. In 2013, with the decline of international gold price, Chinese consumers set off an upsurge of "robbing gold". Then the gold price continued to decline, some consumers were "locked up", the overall demand weakened, and the growth rate of the industry was also slowing down. In 2020, affected by the epidemic, the growth rate of China's jewelry market slowed down, with a market scale of 615.4 billion yuan. From the monthly social zero data in 2021, the jewelry industry as a whole achieved a relatively strong recovery.
China's jewelry industry has formed a stable competition pattern, and brand and channel are the core competitiveness. China's jewelry market can be roughly divided into full category brands and inlaid brands. The whole category of brands also includes national brands such as Chow Tai Fook, Chow Tai Seng Jewellery Company Limited(002867) , Lao Feng Xiang Co.Ltd(600612) and regional brands such as Tongling and Mclon Jewellery Co.Ltd(300945) . National jewelry brands are mainly gold products, with complete consumption level coverage. Its offline channels are widely distributed and deeply penetrated, and are widely distributed in major cities. The number of stores has increased rapidly. There is a downward trend of channels in recent years. Regional brands are based in small areas, and some have achieved cross provincial development. Their scale is small, but they have high popularity and reputation in specific regions. The formation of gold jewelry brand itself takes a long time. It is an industry with heavy operation, which tests the industry channel barriers and capital turnover efficiency. There are certain industry barriers. It has the stability and sustainability of growth.
Gold is the main consumer goods in China's jewelry market, and thanks to the improvement of technology in recent years, gold consumption has become a new trend again. In 2020, gold jewelry consumption accounted for 52% of the jewelry industry and is the main consumer goods in China's jewelry market. The China National Gold Group Gold Jewellery Co.Ltd(600916) market recovered well in 2021, and the consumption demand for gold jewelry released steadily. In 2021, the actual consumption of gold in China was 1121 tons, an increase of 11.8% over the same period in 2019 before the epidemic, including 711 tons of gold jewelry, an increase of 5.2% over the same period in 2019. The proportion of gold sales among major brands has an upward trend, mainly because (1) with the rise of national tide, consumers are more willing to pay for brands and products with Chinese cultural elements; (2) The process is improved and the technology is changed. The traditional full gold is soft, so it is impossible to carry out complex design. However, the improvement and progress of gold technology, such as ancient Fajin, "3D hard full gold", 5g gold, better make up for the defects of traditional gold as jewelry in color, hardness, carving and so on, so that the acceptance of the younger generation of consumers for gold jewelry is also increasing.
Investment suggestion: during the Spring Festival in 2022, the consumption of gold jewelry market picks up. After the epidemic, the gold jewelry industry as a whole shows a strong recovery. At the same time, with the continuous innovation and progress of technology, the consumption of gold jewelry is also strengthening its attraction to young consumers. At present, all brands are still in the stage of sinking and infiltrating stores, and brands and channels are the core competitiveness, After early adjustment in the industry, the PE valuation of head brands generally fell back to the range of 10-15 times. With the recovery of performance, the valuation cost performance is prominent. It is recommended that investors pay attention to potential double-click opportunities, recommend Chow Tai Seng Jewellery Company Limited(002867) , recommend Guangdong Chj Industry Co.Ltd(002345) , Chow Tai Fook, China National Gold Group Gold Jewellery Co.Ltd(600916) , Beijing Caishikou Department Store Co.Ltd(605599) , etc.
Risk tip: the epidemic situation is repeated, the prosperity of terminal consumption is declining, and the market competition is intensifying
