Zhou’s investment view:
1) this week, Midea announced that it would spend 2.5 billion to buy back the company’s shares. Haier Smart Home Co.Ltd(600690) acting in concert, Renhai Chuangzhi increased its holdings of 11.7 million shares with 262 million yuan, accounting for 0.12% of the company’s total share capital; At the same time, several enterprises announced Q1 operation data, and Zhejiang Sanhua Intelligent Controls Co.Ltd(002050) , Qingdao Hiron Commercial Cold Chain Co.Ltd(603187) , Zhenjiang Dongfang Electric Heating Technology Co.Ltd(300217) all achieved stable and high growth in Q1 performance. We believe that the current valuation of the home appliance sector is at a historically low level. Whether it is repurchase or announcing Q1 performance in advance, it is conducive to stabilizing the confidence of investors in the secondary market and reflects the affirmation of enterprises on the future development and performance of the company under the pressure of cost side.
2) the conflict between Russia and Ukraine continues, the price of bulk raw materials continues to rise again, and the cost end of Q1 of household appliance manufacturing enterprises is under pressure again. Actively focus on the new track with low penetration rate and high growth, while the valuation is still low and has not been deeply explored. It is suggested to focus on the high-speed intelligent toilet industry, with the target companies: Haier Smart Home Co.Ltd(600690) , Xiamen R&T Plumbing Technology Co.Ltd(002790) , Shenzhen Megmeet Electrical Co.Ltd(002851) , Huida Sanitary Ware Co.Ltd(603385) , Xiamen Solex High-Tech Industries Co.Ltd(603992) , etc.
3) China’s consumer demand is sluggish, household appliance enterprises actively seek the second growth point, and the road of industrialization continues to advance. We believe that in addition to the enterprises that have made layout in globalization and high-end in advance, they can still enjoy the dividends of household appliance consumption upgrading and global brand expansion, and a considerable number of enterprises will accelerate the practice of industrialization. The logic behind the core lies in the obvious global comparative advantage of China’s household appliance manufacturing, with components leading the way and leading the way. China’s household appliance industrialization is the long-term logic of the sector, focusing on Zhejiang Sanhua Intelligent Controls Co.Ltd(002050) , Zhejiang Dun’An Artificial Environment Co.Ltd(002011) , Hiconics Eco-Energy Technology Co.Ltd(300048) , Zhenjiang Dongfang Electric Heating Technology Co.Ltd(300217) , Hangzhou Star Shuaier Electric Appliance Co.Ltd(002860) .
Industry focus dynamic tracking:
Midea Group Co.Ltd(000333) plans to spend 2.5 billion yuan to buy back the company’s shares, and the repurchase price shall not exceed 70 yuan / share Haier Smart Home Co.Ltd(600690) announced that Renhai Chuangzhi, acting in concert, increased its holdings of 11.7 million shares with 262 million yuan out of its confidence in the long-term development of China’s capital market and the company Midea Group Co.Ltd(000333) , Haier Smart Home Co.Ltd(600690) recent buybacks and holdings increase reflect the company’s confidence in its own development and help stabilize the company’s secondary market shares to a certain extent. We believe that under the background of the continuous rise of raw material prices, China’s leading household appliances have higher profit flexibility. We recommend paying attention to white electricity leading Midea Group Co.Ltd(000333) , Haier Smart Home Co.Ltd(600690) .
Under the big fluctuation of the market, listed enterprises have announced the performance and forecast of January / February in advance, including many household appliance enterprises, Zhejiang Sanhua Intelligent Controls Co.Ltd(002050) , Zhenjiang Dongfang Electric Heating Technology Co.Ltd(300217) , Qingdao Hiron Commercial Cold Chain Co.Ltd(603187) and so on. Focus on home appliance enterprises that have opened the second growth curve: Zhejiang Dun’An Artificial Environment Co.Ltd(002011) , Zhejiang Sanhua Intelligent Controls Co.Ltd(002050) , Zhenjiang Dongfang Electric Heating Technology Co.Ltd(300217) , Hangzhou Star Shuaier Electric Appliance Co.Ltd(002860) , Hiconics Eco-Energy Technology Co.Ltd(300048) . Leading enterprises paying attention to the track of increasing penetration: commercial display freezer track Qingdao Hiron Commercial Cold Chain Co.Ltd(603187) , intelligent projection track Chengdu Xgimi Technology Co.Ltd(688696) , Portable Massager track Shenzhen Breo Technology Co.Ltd(688793) , intelligent toilet track Xiamen R&T Plumbing Technology Co.Ltd(002790) .
Risk factors: macroeconomic environment fluctuations, rising raw material prices, repeated outbreaks at home and abroad, exchange rate fluctuations, serious decline in market end demand, decline in export prosperity and other risks.
