Core view
Textile manufacturing: external factors are changeable, focusing on the forerunner of differentiation and Upgrading & the leader of sports manufacturing segmentation
2021: the gradual recovery of demand outside China and the transfer of orders caused by the outbreak of the epidemic in Southeast Asia have driven the growth of textile demand. At the same time, Q3 has weakened month on month due to the shortage of transportation capacity, power restriction and the sharp rise of some upstream chemical raw materials. However, the overall trend of revenue and profit of the sector is good, and the revenue / profit in the first three quarters has basically returned to the pre epidemic level (year-on-year + 0.3% / + 25% respectively in 2019). In this environment, there are two types of companies with good performance: the downstream is a high-profile sports industry, or through technological breakthrough, realize differentiated competition and drive the double acceleration of revenue / profit (such as Zhe Jiang Taihua New Material Co.Ltd(603055) , Anhui Anli Material Technology Co.Ltd(300218) ). Or by virtue of its outstanding comprehensive advantages such as scale and management, it shows the stability advantage of the leading enterprise's supply chain in a changeable environment, so as to improve efficiency and continuously improve its share in customers (such as Zhejiang Natural Outdoor Goods Inc(605080) , Huali Industrial Group Company Limited(300979) ).
2022: the negative impact of the sharp rise in raw materials and tight transportation capacity is expected to be alleviated, but at the same time, the epidemic trend in Vietnam is good, the return of orders and the uncertainty of demand outside China also bring some pressure to textile enterprises in the coming year. Based on the above trends, it is recommended to pay attention to the differentiated upgrading pioneers Zhe Jiang Taihua New Material Co.Ltd(603055) , Anhui Anli Material Technology Co.Ltd(300218) of new products in the downstream penetration, as well as the sports manufacturing segmentation leaders Huali Industrial Group Company Limited(300979) , Zhejiang Natural Outdoor Goods Inc(605080) with outstanding comprehensive advantages such as scale and management, and Shenzhou International.
Brand clothing: terminal uncertainty or increase, focus on high prosperity sports track, brand strength and good governance
2021: the demand recovered after the epidemic, the rise of national tide driven by Xinjiang cotton, and the demand for clothing recovered rapidly in 2021h1. Then, under the influence of repeated epidemic / flood / warm winter, the growth rate of Q3 slowed down month on month. However, due to changes in the outside world, companies pay attention to internal cultivation and improve operation quality: launch products with higher quality and better solve consumers' pain points. At the same time, we took advantage of the trend, actively arranged emerging channels, accelerated the integration of all channels, and carried out global marketing. After the superposition of Xinjiang cotton, the national brand marketing resources were upgraded, and the national brand strength was significantly improved. Therefore, even if the revenue growth slows down, the profitability improves significantly (the gross profit margin of sports / medium and high-end / home textile industry in the first three quarters is + 5.1 / 1.6 / 1.19pcts compared with the same period in 2019), and the growth rate of leading enterprises is greater than that of the industry, showing stronger toughness.
2022: the epidemic situation and the high base brought by the 2021h1 national tide will bring some pressure on the demand growth in the new year, superimposing the risks of real estate downturn and the downward movement of the long-term potential economic growth center, and the fluctuation or increase of the terminal demand of brand clothing in 2022. In this context, the performance of the subdivided industry with high prosperity or strong brand strength and operation ability is expected to be better than that of the industry as a whole. It is suggested that Anta sports and Li Ning, the sports leaders who pay attention to the continuous improvement of brand strength, the weak short-term terminal, the continuous trend of improving the efficiency of long-term products and supply chain Ningbo Peacebird Fashion Co.Ltd(603877) , the steady growth of customer group income due to relatively small economic fluctuations, high dividends and undervalued value Dazzle Fashion Co.Ltd(603587) , and the positive change with Junzhi, and the Jiangsu Hongdou Industrial Co.Ltd(600400) of governance and brand strength is expected to turn upward.
Risk tips: repeated outbreaks lead to weak terminal demand, higher than expected economic slowdown, large fluctuation of cotton price, and the risk of delayed information or delayed update of public data used in the research report.
