Report guide
Aesthetic awakening + leading change, driving the jewelry sector at the bottom of expectations, is expected to exceed market expectations in 2022.
Key investment points
The undervalued value of the sector leader in the early 10x has reflected the market's pessimistic expectations for jewelry: since the second half of 2021, the valuation has dropped significantly, and the valuation of the head jewelry company has basically dropped to the relatively low position of the historical center. The P / E ratio of the sector leader is generally lower than 15x, which reflects the market's pessimistic expectations for consumption and marriage.
"Aesthetic awakening", there are industrial opportunities for jewelry:
Consumer aesthetic awakening occurs not only in the fields of clothing and cosmetics, but also in the field of jewelry. Jewelry gradually deviates from material properties and moves towards "consumerism". Consumers are willing to pay a premium for the brand and its value proposition, as well as for product style and technology. At the same time, thanks to the rise of online content traffic channels, it has accelerated the process of aesthetic awakening. DEA shares (officially started in 14 years and grew into a revenue of nearly 5 billion in 21 years), the rapid rise of APM (rapidly growing from a OEM to a head jewelry brand that can be benchmarked with Pandora), and the rapid and large-scale production of gufajin (the labor cost is about 50 yuan higher than the traditional process) products with high processing cost all show that consumers' aesthetic mind is awakening rapidly, This will be the most important consumption trend leading the development of the jewelry industry.
"The dragon head Dances", and a new pattern of jewelry is emerging:
The theme of the next era of the industry is the transformation and differentiation of leading brands. Leading brands that can grasp the consumption trend and innovate themselves will eventually stand at the forefront of the times, obtain a real brand premium and enter another valuation system. After 10 years of rapid development of gold jewelry, the industry entered a reshuffle period. The epidemic situation has accelerated the clearing and head concentration of the industry. The leader has developed against the trend due to strong resources, heavy innovation, premium and high efficiency.
1) Store opening end: since the end of 18, Dafu has added 2000 + stores, Lao Feng Xiang Co.Ltd(600612) , Chow Tai Seng Jewellery Company Limited(002867) 1000 + stores, while regional jewelry, such as Leysen Jewelry Inc(603900) , Fujian Ideal Jewellery Industrial Co.Ltd(002740) , Cuihua, etc., have declined. 21q3 the number of new stores in Chow Tai Fook mainland was 385, followed by China National Gold Group Gold Jewellery Co.Ltd(600916) , Laomiao and Chow Tai Seng Jewellery Company Limited(002867) . From the chain comparison, the chain comparison speed of Chow Tai Fook, Chow Tai Seng Jewellery Company Limited(002867) and Guangdong Chj Industry Co.Ltd(002345) was accelerated.
2) Performance side: 20q3 is the first quarter after the recovery of the epidemic in the first half of the year. From the distribution side data of listed companies, it is a high base. In 21q3, Chow Tai Fook grew the most (mainland retail value + 58%, fy22h1 net profit + 52%), followed by Guangdong Chj Industry Co.Ltd(002345) (net profit + 24%) and Chow Tai Seng Jewellery Company Limited(002867) (net profit + 4%).
Data catalysis: the prosperity of gold jewelry continues, and the leading data end is gradually realized.
According to the data of China National Gold Group Gold Jewellery Co.Ltd(600916) Association, the consumption of gold jewelry in 20q4 decreased by 25% year-on-year in 18q4, 4% year-on-year in 19q4, and - 10% / + 5% / + 10% year-on-year in 21q1 / 21q2 / 21q3, and + 84% / + 55% / + 33% year-on-year in 20. It can be seen that 20q4 and 21q1 are still recovering. Gold jewelry Technology aesthetic progress + diversified demand improvement, gold is expected to continue the high boom. As the leader gradually smoothes out the channel system and goods system, it is expected to gradually realize the performance and operation efficiency of the same store and the same store on the data side.
Investment suggestions: recommend Guangdong Chj Industry Co.Ltd(002345) , Chow Tai Seng Jewellery Company Limited(002867) , and pay attention to Chow Tai Fook.
Guangdong Chj Industry Co.Ltd(002345) : beneficiaries of jewelry wave, undervalued value + Fundamentals reversal. Chow Tai Seng Jewellery Company Limited(002867) : the most enterprising jewelry leader, provincial agent system + gold category drive new growth. Suggestions and concerns: Chow Tai Fook: jewelry is the absolute leader, Zheng Zhigang takes the lead, injects entrepreneurship, and old brands are rejuvenated.
Risk factors: repeated epidemic situation and consumption recovery less than expected; Increased competition.
