Investment summary:
Talk every Monday: cotton prices hit a ten-year high in November
Event: since March 2020, China's cotton price has continued to rise. By the end of November 2021, the cotton price has been the highest in recent ten years. According to the statistics of the National Bureau of statistics, the latest data show that in November, China's cotton price has reached 22566.6 yuan / ton, up 0.9% month on month and 50.9% year-on-year; According to the data of the U.S. Department of agriculture, on November 30, the global adjusted price of cotton was 102.65 cents / pound, up 75.08% year-on-year.
Reasons for the rise in cotton prices: 1) the national cotton output is expected to decrease by 2.5% year-on-year compared with last year; 2) The progress of cotton picking and selling in China was slower than last year; 3) Foreign cotton planting industry continues to be affected by the epidemic; 4) Rising global freight rates; 5) Affected by the epidemic, the export volume of the textile industry increased.
Downstream textile and garment industry companies are under pressure, and the concentration is expected to increase. China has put in central reserve cotton twice to curb the price rise. ICAC predicts that the global cotton supply and demand gap will narrow, and we still need to pay attention to the impact of the new epidemic on cotton prices. At present, the cotton price is at a high level, the cost of downstream textile and garment enterprises is under pressure, the operation pressure of small and medium-sized enterprises in the industry is increasing, and the industry concentration is expected to increase. It is suggested to pay attention to the leading enterprises in the industry.
Market review (November 29-December 3):
Among the Shenwan level industries, the light industry manufacturing industry rose 0.42% this week, ranking 19th among the 28 first level industries in Shenwan, outperforming the market. Among the sub sectors, the paper sector performed better, up 3.06%, while other light industry manufacturing performed poorly, down 3.1%; The textile and garment industry fell 1.42% this week, ranking 25th among the 28 first-class industries in Shenwan, outperforming the market, and the sub sectors textile manufacturing and garment home textile fell.
Investment strategy:
Furniture: this week, the central bank, the China Banking and Insurance Regulatory Commission and the China Securities Regulatory Commission responded to Evergrande's failure to fulfill its guarantee responsibility for us dollar bonds. The central bank said that "the risk of individual real estate enterprises in the short term will not affect the normal financing function of the medium and long-term market". The China Banking and Insurance Regulatory Commission said that "focus on meeting the demand for first home and improved housing mortgage, and reasonably issue real estate development loans and M & A loans", The CSRC said that it "supports the reasonable and normal financing of real estate enterprises". Recently, the real estate market policy tends to be loose and optimistic about the advantages of leading enterprises in the downstream furniture industry [ Oppein Home Group Inc(603833) ].
Papermaking: in terms of household paper, the price of raw materials has rebounded slightly in the past two weeks, some enterprises have adjusted the product price, the long-term investment idea remains unchanged, and are optimistic about the industry leader [ C&S Paper Co.Ltd(002511) ]; In terms of packaging paper, the price of raw materials this week is lower than that in November. At the same time, affected by the shopping festival outside China, the fourth quarter is the peak season for packaging paper demand, and we are optimistic about the leader of the packaging industry [ Shenzhen Yuto Packaging Technology Co.Ltd(002831) ].
E-cigarette: the State Council issued a decision on Amending the regulations for the implementation of the tobacco monopoly law of the people's Republic of China, which will regulate e-cigarette and other new tobacco products with reference to cigarettes, and the e-cigarette industry will change from disorderly development to orderly expansion. It is suggested to pay attention to the leader of e-cigarette equipment manufacturer [smog international].
Textile and clothing: this week, cotton prices fell after a long-term rise. The release of reserve cotton has achieved initial results, but the price is still high. It is suggested to pay attention to the leading enterprises in the industry. Bosideng, the first down jacket brand in China, has established a joint venture with Bogner, a German high-end clothing brand, and the competitive brand canadian goose has negative public opinion in China. It is recommended to pay attention to [Bosideng].
Risk tips: raw material price fluctuation risk and exchange rate fluctuation risk.
