Key investment points
Market last week: light industry manufacturing sector index fell. The Shenzhen Composite Index of light industry fell to 202195/28 million, and the Shenzhen Composite Index of light industry fell to 2021.2 million; The rise and fall of light industry manufacturing index sub sectors from high to low are packaging and printing (- 1.08%), household light industry (- 2.28%) and papermaking (- 3.64%).
Furniture: continue to pay attention to the continuous differentiation between the head brand and the industry, and the first is [ Suofeiya Home Collection Co.Ltd(002572) ]. In terms of domestic sales of furniture, the margin of real estate policy has been relaxed since 2021q4, but the performance of real estate sales data is weak, and the valuation of furniture sector is in a low position. However, we emphasize that 1) the proportion of home demand released by stock houses and old transformation continues to increase, and the correlation between home industry demand and new house sales has decreased; 2) The differentiation between leading enterprises and industries continues to intensify, and the concentration degree is improved due to the evolution of leading retail capacity under the changing flow structure. In the short term, the current epidemic may have a certain impact on the sales performance of the furniture industry in March 2022, but the demand for furniture renewal and upgrading caused by lagging demand and home isolation is expected to be fully released from April to may 2022, with a relatively limited impact on the annual performance. In the follow-up, we believe that under steady growth, the marginal easing of real estate policy is expected to increase, the leading enterprises are expected to continue to outperform the industry, and the valuation has more room for repair. Continue to recommend [ Suofeiya Home Collection Co.Ltd(002572) ] management improvement and retail under the whole strategy is expected to accelerate; Continue to recommend [ Oppein Home Group Inc(603833) ], the forerunner of retail reform, the increasingly clear route of big home [ Jason Furniture (Hangzhou) Co.Ltd(603816) ], the [ Xlinmen Furniture Co.Ltd(603008) ] to accelerate the smooth expansion of independent brands and the functional sofa leader [Minhua holding] with low valuation. It is recommended to pay attention to [ Zbom Home Collection Co.Ltd(603801) ], [ Goldenhome Living Co.Ltd(603180) ]. In terms of export, we recommend [ Healthcare Co.Ltd(603313) ] where the dilemma can be reversed and the scarcity of us production capacity layout can be realized gradually under anti-dumping. We suggest paying attention to [ Zhejiang Walrus New Material Co.Ltd(003011) ] where production capacity release drives high income growth and strong bargaining power.
The penetration rate of e-cigarettes continues to improve. The taste ban will have a certain impact on the scale of the industry in the short term. This week, many e-cigarette brands have announced the suspension of flavored e-cigarettes. However, in the medium and long term, on the one hand, the deepening of tobacco taste research and development is expected to improve the conversion rate of old smokers. On the other hand, as an addictive consumer product, the core advantage of e-cigarette lies in its harm reduction. With reference to the seasoning ban in the United States, the market demand is expected to make a relatively rapid repair. Continue to recommend [smore international]; It is suggested that we should pay close attention to the close cooperation with China tobacco, and distribute the flavors and fragrances and evaluate the Shenzhen Jinjia Group Co.Ltd(002191) with high price performance ratio. Enterprises with thick slurry flake production technology [ Anhui Genuine New Materials Co.Ltd(603429) ].
Papermaking: cultural paper will send another 300 yuan price increase letter, and its profitability will be gradually restored. In terms of price, as of March 18, 2022, the price of wood pulp was 6865.2 yuan / ton, with a decrease of 436 yuan / ton on a weekly basis; The latest price of carton board paper was 4833 yuan / ton, unchanged on a week-on-week basis; The latest price of white cardboard is 6390 yuan / ton, with a weekly increase of 10 yuan / ton; The latest price of whiteboard is 5080 yuan / ton, with a weekly increase of 100 yuan / ton; The latest price of double copper paper was 5680 yuan / ton, unchanged on a week-on-week basis; The latest price of double offset paper is 6225 yuan / ton, with a weekly increase of 50 yuan / ton. In terms of inventory, as of Thursday (March 17, 2022), the inventory of cultural paper and corrugated paper enterprises increased slightly on a weekly basis. This week Shandong Sun Paper Co.Ltd(002078) , app, Taisheng, Asia Pacific Senbo and others sent another 300 yuan price increase letter. The price increase of cultural paper was better than we expected. The impact of double reduction and 2021q4 new production capacity was gradually digested, and the profitability of cultural paper is expected to hit the bottom and rise. It is recommended that [ Shandong Sun Paper Co.Ltd(002078) ]: the valuation has a margin of safety, the forest area of Laos base continues to grow, and the cost advantage and risk resistance under the integration of Forest Pulp paper were improved.
Risk tip: power rationing policy affects production capacity, raw material price fluctuations, intensified Sino US trade frictions, weak downstream demand, etc.
