Core view
Market review: in recent two weeks, the top five companies in the A-share textile and garment sector are Jiangsu Sunshine Co.Ltd(600220) , duolik, baibaolong, Hubei Mailyard Share Co.Ltd(600107) , Hunan Huasheng Co.Ltd(600156) ; In the past two weeks, the top five companies in the textile and garment sector of Hong Kong stocks were hudu, mushang Group Holdings, doctoral frog international, I.T. and Jiuxing holdings. Looking at the PE (next 12 months) range of the company in the past two years, after a round of adjustment in the past two weeks, the P / E ratio of most A-share and Hong Kong stock related companies is at the bottom of the historical valuation, and most A-share and Hong Kong stock related companies began to rebound with the release of favorable signals from the policy side in the past two days. We suggest paying attention to the allocation opportunities after the valuation correction of high-quality companies.
Data tracking: from January to February 2022, social zero was + 9.1% year-on-year, and clothing retail was + 4.8% year-on-year. It still achieved steady and good growth under the high base of last year; In February 2022, the online retail of wearing goods increased by + 3.9% year-on-year; In February 2022, the online retail sales of women's wear, men's wear, children's wear, sportswear and sports shoes on tmall and JD platform were - 18.9%, - 19.7%, - 21.8%, - 2.5% and - 11.3% respectively year-on-year. Among the official flagship stores of tmall sportswear focused on in February, Salomon, Kolon, Archaeopteryx, bosden and lululemon ranked among the top five, with an increase of 164%, 159%, 155%, 154% and 109% respectively. From January to February, the total amount of China's textile exports was + 11.9% year-on-year, and the amount of clothing exports was + 6.9% year-on-year, maintaining a stable growth. From January to February 2022, Vietnam's textile exports increased by 19% year-on-year. On March 16, 328 cotton price index (yuan / ton) was 22752, a month on month increase of - 0.3%; The price difference between domestic and foreign cotton (yuan / ton) is 1340. In the past two weeks, the average startup rate of water jet looms in Shengze area was 69.3%, up 1p p.。 The price of nylon 66 chips in the past week was 41000 yuan / ton, 0% month on month; The price of nylon fiber in the past week was 20710 yuan / ton, up + 3.4% from last week.
Industry trends: INDITEX, H & M, Prada and hugoboss announce the latest performance; Shein announced to actively expand its business in Los Angeles and Washington; Lululemon officially entered the footwear category.
Investment suggestion: from January to February this year, the growth rate of social zero sum clothing consumption returned to positive, reflecting a good trend on the consumer side. Although the spread of the epidemic in March may affect offline consumption in the short term, we are still optimistic about the potential improvement of high-quality local sports brands and the growth prospects of the industry. China's textile and garment exports continue to maintain a good growth trend. Manufacturing enterprises benefit from the situation of sufficient orders and tight supply. The fundamental trend is relatively better. They are optimistic about leading companies and high value-added manufacturing enterprises with growth certainty and bargaining power. At present, most companies are at the bottom of the valuation range in recent two years, and the recent policy side has released positive signals. We suggest to seize the allocation opportunities after the valuation correction. We recommend Shenzhou International, Anta sports, Li Ning and Tebu international for Hong Kong stocks, and Huali Industrial Group Company Limited(300979) , Zhe Jiang Taihua New Material Co.Ltd(603055) , Zhejiang Weixing Industrial Development Co.Ltd(002003) .
Risk tips: 1. Repeated epidemic situation; 2. Deterioration of competition; 3. Damaged brand image; 4. The price of raw materials fluctuates greatly; 5. Systemic risk.
