Key investment points
Market review: mid year turning point, valuation fell. 1) Market: in 2021, the textile and clothing sector outperformed the market by 8.6pct, taking the lead in the consumer industry. Under the comprehensive influence of the epidemic, climate and geopolitical events, the stock price rose as a whole in the first half of the year and fluctuated and corrected in the second half of the year. 2) Valuation: as of February 10, 2022, the P / E ratio of the industry is around 20x, which is at a relatively low historical level.
Brand clothing: the performance fluctuates and the track is the king. 1) In 2021, the recovery of consumption was blocked, and the overall clothing consumption was weak. 2) Listed companies have a good recovery in 2021q1 / Q2, and Q3 is again impacted by the epidemic. We expect that the revenue of 2021 will show a weak recovery compared with 2019, but the net profit attributable to the parent company has not returned to the level before the epidemic. 3) The retail performance of sports clothing brands is relatively strong, and the advantages of the track are prominent. 4) Outlook: the weak recovery of consumption will continue, the national tide will bring industrial opportunities, and sportswear will be the leader β&α Advantages and leaders in various subdivided fields are expected to benefit from the improvement of concentration in the medium and long term.
Textile manufacturing: the expansion of leading enterprises is relatively stable. 1) In 2021, textile and clothing exports remained booming, cotton prices rose and capacity utilization picked up. 2) The recovery of revenue and net profit of listed companies is better than that of brand clothing; Performance differentiation in subdivided fields: cotton textile > shoe and clothing manufacturing > printing and dyeing > non-woven fabric. 3) Trend Outlook: the relocation of production capacity and the improvement of concentration will continue, and the stronger the stronger.
Investment advice: look for certainty in an uncertain environment. 1) Upstream fluctuation and downstream stability. Compared with brand clothing, the performance of upstream manufacturers is relatively stable, but we need to pay attention to the rebound opportunity of brand clothing after the end of the epidemic. 2) Brand clothing: four main lines: ① some leading sub circuits (such as sports and children's clothing) with high growth rate; ② Companies with significant internal adjustment, new channel dividends and continuous improvement of brand strength; ③ Companies that are expected to benefit from the new dividends in the industry with the rise of domestic products; ④ In the medium and long term, it is expected to benefit from the leading segments of the industry with improved industry concentration. Recommend Anta sports, Li Ning, Bosideng, Biem.L.Fdlkk Garment Co.Ltd(002832) , Zhejiang Semir Garment Co.Ltd(002563) , Jinhong Fashion Group Co.Ltd(603518) , Ningbo Peacebird Fashion Co.Ltd(603877) , etc., and pay attention to Hla Group Corp.Ltd(600398) , Dazzle Fashion Co.Ltd(603587) , Luolai Lifestyle Technology Co.Ltd(002293) ; 3) Textile manufacturing: three main lines: ① leading enterprises benefiting from order transfer and high customer stickiness after the epidemic; ② Overseas production capacity layout & the leader with clear expansion plan; ③ Benefit from the increased order concentration and the upstream leader of high-quality track (such as sportswear) in brand clothing. It is recommended to Huali Industrial Group Company Limited(300979) , Bros Eastern Co.Ltd(601339) and pay attention to Shenzhou International.
Risk tip: repeated outbreaks have led to weak terminal retail, sharp fluctuations in cotton prices, fluctuations in the RMB exchange rate, and the lifting of the company's ban on restricted shares.
