Industry perspective update:
Home furnishing: the home furnishing sector has made a correction this week. We believe that it is more due to the disturbance at the capital level. From the perspective of fundamentals, there has been no significant change except that the epidemic has been disturbed again. At present, the 315 activity is at a critical stage. From our tracking, the head brand is progressing smoothly. Although there are epidemic disturbances in many places, the online signing is ideal, and the overall progress of the activity has not been significantly affected. We believe that the changes in the supply side of home furnishings in 2022 will be more noteworthy than the demand side. Under the trend of integrated sales of customization and software, the requirements for the comprehensive ability of brands and dealers will be higher, the competition threshold will be significantly improved, and the industry pattern is expected to usher in marginal optimization. On the whole, we are optimistic about Oppein Home Group Inc(603833) Jason Furniture (Hangzhou) Co.Ltd(603816) and Suofeiya Home Collection Co.Ltd(002572) , in which the results of deep reform will gradually appear.
New type of tobacco: in terms of atomization, the national standard of e-cigarette (second exposure draft) and management measures have been implemented since May 1. The biggest change in this policy is to limit the taste of e-cigarette to that of tobacco. We think it may be difficult for the original consumer groups to accept in the short term, but in the long term, On the one hand, the legalization of e-cigarette identity is conducive to solving consumers' concerns about product safety. On the other hand, it can make the positioning of e-cigarette target customers more clear, not attract young people's consumption, and promote the sustainable and healthy development of the industry as a whole. After the new regulations, if various brands gradually improve the taste and product power of tobacco, based on the harm reduction effect, its long-term growth space is still worth looking forward to. Moreover, in the future, the license system will be strictly implemented, and new products also need technical review. To a certain extent, it will not only raise the entry threshold of the industry, but also greatly optimize the pattern of manufacturers. In addition, the export policy is still relatively loose. On the whole, smalls' short-term performance may be subject to fluctuations in the Chinese market, but the certainty of long-term growth is improving. In terms of HNB sector, after the implementation of atomized e-cigarette policy, HNB policy may also accelerate the implementation, and the overall development expectation is still relatively optimistic.
Papermaking: the marginal improvement of supply and demand + cost support drive the price increase to the ground. It is the first to promote special paper targets with good pattern and pulp leaders with high cost self supply rate. 1) Operating angle: the operating rates of coated paper and double offset paper this week were + 4.33% and + 0.67% month on month, that of white cardboard was + 1.75% month on month, and that of box board corrugated paper was + 0.24% and - 1.03% month on month respectively; 2) Inventory angle: the inventory days of coated paper and double offset paper are + 1.99% and + 2.06% respectively, the inventory of white cardboard is + 0.06%, and the inventory of box board corrugated paper is + 6.83% and 12.21% respectively; Xuexun has driven the marginal recovery of demand for cultural paper + the weakening of pressure at the import end. Some kinds of paper represented by white cardboard have shown their price advantages under the pressure of overseas energy & force majeure, and the export end has performed vigorously, promoting the further improvement of the supply and demand pattern. In addition, affected by the pressure on the cost supply side, the price of wood pulp is rising continuously, which supports the smooth implementation of the price increase of paper enterprises, but the excess transfer of subsequent costs still depends on the prosperity of downstream demand.
Investment advice
Home furnishing: recommend Oppein Home Group Inc(603833) (Integrated Business & platform), Jason Furniture (Hangzhou) Co.Ltd(603816) (domestic share concentration & export profit elasticity), Suofeiya Home Collection Co.Ltd(002572) (it is improving in many aspects, and there is a large space for valuation repair).
Papermaking: it is recommended that Shandong Sun Paper Co.Ltd(002078) , the fundamentals be repaired quarterly from 1q, the demand for cultural paper has warmed up in the peak season, and the stock replenishment & under the background of low profit, the price increase of the paper mill in February has been successfully implemented, the cost end of Guangxi 800000 tons of chemical pulp has been put into operation, and the rebound of the outer disc pulp price has a limited impact on the cost; The medium-term release of 5.25 million tons of production capacity supports the growth logic.
Risk factors
The extent and duration of the slowdown in China's consumption growth exceeded expectations; Real estate sales have been shrinking sharply for a long time; The price of raw materials rose faster and longer than expected; The exchange rate fluctuated sharply.
