Zhou’s views and investment suggestions
Shenzhou International: the external adverse factors in the past 21 years have been fully reflected, and the long-term competitive advantage remains unchanged. The company issued a performance warning. The net profit after tax for the whole year of 2021 was 3.1-3.5 billion yuan, a year-on-year decrease of 31% – 39%. The profit did not meet expectations, mainly due to the shutdown of factories, exchange losses and increased production costs caused by the epidemic. From the perspective of operation, the production end has resumed production and received orders smoothly so far. The newly put into operation factories have climbed the slope, and the factories in Cambodia and Vietnam have expanded the recruitment of 10000 people. The production capacity is expected to be fully released this year; The cooperation between the demand side and international customers continues to deepen. On the whole, the long-term barriers remain unchanged and the 22-year repair flexibility is large. It is recommended to focus on it.
Huali Industrial Group Company Limited(300979) : the demand for brand orders is strong, and Vietnam’s production expansion plan is expected to speed up. The company issued a performance express. It is expected to achieve a revenue of 17.47 billion yuan (+ 25.4%, with an increase of 34.1% in the reduced US dollar caliber) and a net profit of 2.76 billion yuan (+ 47.3%, with an increase of 57.6% in the reduced US dollar caliber) in 21 years, which is at the center of the previous performance forecast and in line with expectations. In 4q21, the company’s revenue increased by 33.46% year-on-year, and the net profit attributable to the parent company increased by 37.39% year-on-year. From the perspective of operation, the orders of major customers on the order side have increased significantly, and the orders of new customers such as ASICs and on have also reached mass production and shipment; On the supply side, the annual production capacity is expected to reach 210 million pairs, and the capacity improvement mainly comes from the expansion of old plants and the smooth climbing of new plants.
Investment suggestion: it is suggested to pay attention to Huali Industrial Group Company Limited(300979) , Zhe Jiang Taihua New Material Co.Ltd(603055) , Huafu Fashion Co.Ltd(002042) , which highlight the stability of the supply chain, orderly promote capacity expansion and exceed the expected sales performance of downstream customers; At the downstream end, it is suggested to pay attention to Li Ning, who leads in product design and has superior brand potential, as well as Tebu international, which has highlighted the advantages of running shoes. Data and announcement tracking
Market review: last week (February 28, 2022 ~ March 4, 2022), the Shanghai Composite Index, Shenzhen Component Index and Shanghai Shenzhen 300 fell – 0.11%, 2.93% and 1.68% respectively, and the textile and garment sector rose 0.39%, of which the textile sector rose 0.47% and the garment sector rose 1.00%.
Raw material price: 328 grade cotton spot 22700 yuan / ton (0.11%, weekly rise and fall); American cotton Cotlook a134 45 cents / pound (- 0.15%); The price difference between domestic and foreign cotton is 1392 yuan / ton (11.63%).
Announcement of key companies: 1) Bros Eastern Co.Ltd(601339) : publicize the performance express of 2021, realizing a total operating revenue of 7.676 billion yuan, an increase of 25.12% over the same period of last year; The net profit attributable to the parent company was 1.384 billion yuan, an increase of 278.09% over the same period last year; The net profit deducted from non-profit was 1.339 billion yuan, an increase of 365.84% over the same period of last year. 2) Zhejiang Semir Garment Co.Ltd(002563) : the company recently received a notice from the shareholder Mr. Qiu Qiangqiang that some shares of the company held by Mr. Qiu Qiangqiang have been released from pledge and pledge. The total number of shares released from pledge is 48 million, accounting for 13.35% of its shares and 1.78% of the total share capital of the company. The total number of Pledged Shares is 53 million, accounting for 14.75% of its shares and 1.97% of the total share capital of the company.
Risk tips
Repeated epidemic risk, exchange rate fluctuation risk, rising labor costs in Vietnam and lower than expected price increase.
