Household appliance industry: the implementation of subsidies has been accelerated, and pan consumption stimulation has become the mainstream

Introduction to this report:

After the frequent stimulation of household appliance consumption, the policy is expected to continue to ferment. From the perspective of consumption subsidies throughout the Spring Festival, the follow-up pan consumption stimulus is expected to be the mainstream and boost the structural demand for household appliances.

Summary:

Investment suggestions: focus on the clean electrical appliances, small household appliances and white electricity sectors that are expected to benefit from the improvement of rice consumption stimulation at the level of domestic demand. In terms of individual stocks, the key recommendations are Zhejiang Supor Co.Ltd(002032) (22pe: 17.41) and Ecovacs Robotics Co.Ltd(603486) (22pe: 17.41) that are expected to benefit from the growth of the demand for third and fourth tier small household appliances

28.13), Beijing Roborock Technology Co.Ltd(688169) (22pe: 21.78), Midea Group Co.Ltd(000333) (22pe: 14.72) with wide channel coverage and complete categories, leading high-end multi brand layout, and Haier Smart Home Co.Ltd(600690) (22pe: 15.46) with rapid expansion of offline three winged bird experience stores.

Difference from market cognition: the market generally expects special subsidies for household appliances similar to the large-scale and restricted categories in 2007-13, and greatly improves the penetration rate of some household appliances. However, we believe that the original intention of consumption subsidies at the current time is not to promote the development of the insurance industry or stimulate GDP growth in the short term, but more under the expectation of the decline of overseas demand, In order to maintain the steady development of the economy from the perspective of boosting domestic demand and ensuring employment, pan consumption subsidies may continue to be the mainstream, thus driving the release of demand for non rigid household appliances such as small household appliances and clean appliances.

Sorting out the recent subsidies for household appliances and pan consumer vouchers: the recent consumption subsidy activities in various places during the Spring Festival have the following characteristics: 1) activity areas: the scope of participation is widened without being constrained by local fiscal surplus conditions; 2) Activity time: around the Spring Festival of 22 years, the total implementation time is short, which is different from the previous time span in years; 3) Activity form: local governments organize enterprises to participate, and jointly issue consumption vouchers through the payment platform in advance; 4) Scope of subsidies: mainly based on Pan consumption stimulation, special vouchers for household appliances consumption are issued in some regions, and there are no specific requirements for household appliances, and most regions have no requirements for energy efficiency standards.

The further prospect of the follow-up Household Appliance Subsidy Policy and the judgment of its impact: 1) the implementation of subsidies is still dominated by local implementation. The current round of subsidies is still implemented and organized independently by all localities, but for the understanding of "conditional places", we believe that the application will be extended from areas with abundant finance to areas with consumption potential of residents or high cooperation of local enterprises; 2) The form of consumer voucher subsidies will continue. For the current household appliance ownership level and disposable income level, the previous form of "limited categories, consumption first and then subsidies" is expected to have no effective consumption stimulating effect. Advance issuance of consumption vouchers, especially general-purpose cash vouchers, will improve the level of residents' disposable income to a certain extent, which is conducive to the release of structural demand with low penetration and non rigid needs such as clean appliances and small household appliances; 3) The implementation of subsidy activities is expected to continue the rhythm of this round of short cycle and intensive distribution.

As the penetration rate of household electrical appliances has increased significantly after the last round of large-scale subsidies, long-term subsidy activities may lead to fatigue and it is difficult to maintain consumption enthusiasm. Expected full-term leave or follow-up activities; 4) In order to promote the consumption of green and energy-saving household appliances, the use of some large household appliance consumption vouchers is expected to be combined with the requirements of energy efficiency standards. So as to promote the deepening of replacing the old with the new and saving energy to benefit the people, and realize the substitution of old household electricity.

Risk tip: the implementation of subsidy policy is less than expected: the scope of subsidy is limited in a small number of regions, and the proportion of government investment is low; The epidemic has further intensified to curb the recovery of offline consumption

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