Key investment points
Market last week: light industry manufacturing sector index rose. From February 21, 2022 to February 25, 2022, the Shanghai Composite Index fell 1.13%, the Shenzhen Component Index fell 0.35%, and the light industry manufacturing index fell 0.63%, ranking 16th among the 28 Shenwan industries; The rise and fall of light industry manufacturing index sub sectors from high to low are: papermaking (+ 2.56%), household light industry (- 1.86%), packaging and printing (- 0.66%).
Furniture: the first is Suofeiya Home Collection Co.Ltd(002572) , and the whole package of 39800 is launched. We are optimistic about the retail acceleration under the whole strategy. In terms of domestic sales of furniture, β Due to the continued repair of valuation under steady growth, the margin of real estate policy has been relaxed since 2021q4, while the valuation of furniture sector is still in a low position, and there is still room for repair. α It comes from the concentration improvement brought by the evolution of leading retail capacity under the continuous change of traffic structure. This week [ Suofeiya Home Collection Co.Ltd(002572) ] launched 39800 customized packages, covering customized cabinets, customized wardrobe, background wall, software products and household appliances, which is expected to promote the rapid rise of customer unit price. The company added cabinets and wooden doors under the main brand Suofeiya Home Collection Co.Ltd(002572) to promote the integration of categories and solve the pain point that the flow of wardrobe is difficult to flow to the cabinet. The whole package is supported by the systematically sorted product system and the continuously strengthened supply chain, which has significantly improved the style consistency. In addition, Oppein Home Group Inc(603833) , Jason Furniture (Hangzhou) Co.Ltd(603816) also launched the whole package priced at 29800 and 49800 respectively (see the text for the comparison of package contents). We continue to be optimistic about Suofeiya Home Collection Co.Ltd(002572) management optimization to stimulate the vitality of dealers and the improvement of customer quantity and customer unit price under the implementation of the whole strategy. At the same time, [ Oppein Home Group Inc(603833) ], the forerunner of retail reform, the increasingly clear route of big home [ Jason Furniture (Hangzhou) Co.Ltd(603816) ] and the functional sofa leader [Minhua holdings] with low valuation are recommended to pay attention to [ Zbom Home Collection Co.Ltd(603801) ], [ Goldenhome Living Co.Ltd(603180) ]. In terms of export, we recommend [ Healthcare Co.Ltd(603313) ] where the dilemma can be reversed and the scarcity of us production capacity layout can be realized gradually under anti-dumping. We suggest paying attention to [ Zhejiang Walrus New Material Co.Ltd(003011) ] where production capacity release drives high income growth and strong bargaining power.
Papermaking: the price rise of cultural paper is smooth, and the profitability is expected to be repaired. As of February 24, 2022, the price of wood pulp was 6685.5 yuan / ton, with a weekly increase of 259 yuan / ton; The price of box board paper is 4901 yuan / ton, with a decrease of 27 yuan / ton on a weekly basis; The price of corrugated paper was 3868.8 yuan / ton, with a decrease of 53 yuan / ton on a weekly basis; The price of white cardboard is 6205 yuan / ton, with a weekly increase of 10 yuan / ton; The latest price of double copper paper was 5380 yuan / ton, unchanged on a week-on-week basis; The price of double offset paper was 5837.5 yuan / ton, with a weekly increase of 13 yuan / ton. In terms of inventory, as of last Thursday (February 24, 2022), the weekly ratio of cultural paper and inventory decreased slightly, and the weekly ratio of corrugated paper enterprise inventory increased slightly. The implementation of the current round of price increase of cultural paper is good, the inventory gradually moves down, and the profitability is expected to hit the bottom. It is recommended that [ Shandong Sun Paper Co.Ltd(002078) ]: the valuation has a margin of safety, and Guangxi plans to invest in the construction of an industrial park with a capacity of 5.25 million tons to ensure medium and long-term growth; The forest land area of Laos base continues to grow, and the cost advantage and risk resistance are improved under the integration of Forest Pulp and paper.
E-cigarettes: four departments took special actions to regulate the sales of e-cigarettes, and Shenzhen Jinjia Group Co.Ltd(002191) disclosed the performance express, with outstanding performance of new-type tobacco. 1) On February 22, 2022, the Ministry of public security, the State Administration of tobacco, the State Administration of market supervision and administration and the Bureau of Education jointly issued the special work plan for cleaning up and rectifying the sale of e-cigarettes to minors and severely cracking down on crimes involving e-cigarettes, laying the foundation for the implementation of follow-up regulatory policies. China’s head e-cigarette brands have already verified the age of consumers through a variety of technical means. The promotion of special work is expected to promote the gradual elimination of small and medium-sized brands with chaotic management and further improve the industry concentration. 2) Shenzhen Jinjia Group Co.Ltd(002191) disclosed in the performance express, the company expects to achieve an operating revenue of 5.08 billion yuan in 2021, a year-on-year increase of + 21.3%, and a net profit attributable to the parent company of 1.01 billion yuan, a year-on-year increase of + 22.1%,. The company’s new tobacco business revenue was + 381.16% year-on-year, entering a rapid volume period. Continue to recommend [smore international]; It is suggested to pay attention to China’s electronic cigarette leader [fog core technology] with high callback range; Close cooperation with China tobacco, layout of flavors and fragrances, valuing Shenzhen Jinjia Group Co.Ltd(002191) with high price performance ratio. Enterprises with thick slurry flake production technology [ Anhui Genuine New Materials Co.Ltd(603429) ].
Risk tip: power rationing policy affects production capacity, raw material price fluctuations, intensified Sino US trade frictions, weak downstream demand, etc. Note: except for special notes, all currencies in the full text are RMB.
