Key investment points:
Recent market review
In February, the CSI 300 index rose by 0.39%, and the home appliance (CITIC) industry fell by 5.16%. The industry lost the market by 5.55 percentage points, ranking 30th among the 30 CITIC primary industries. Among them, lighting electricians and other sub industries increased by 1.97%; White home electronics industry fell 6.88%; The kitchen appliance sub industry fell by 3.48%; Black home electronics industry fell 4.15%; The small electronics industry fell 1.04%. In terms of individual stocks, the top gainers are Guangdong Tonze Electric Co.Ltd(002759) (+ 14.07%), Sichuan Huati Lighting Technology Co.Ltd(603679) (+ 13.65%), Guangzhou Echom Sci.&Tech.Co.Ltd(002420) (+ 11.57%), Canature Health Technology Group Co.Ltd(300272) (+ 11.56%) and Qijing Machinery Co.Ltd(603677) (+ 10.45%); The largest declines were Chengdu Xgimi Technology Co.Ltd(688696) (- 19.51%), Jinhua Chunguang Technology Co.Ltd(603657) (- 14.93%), Joyoung Co.Ltd(002242) (- 13.24%), Hisense Visual Technology Co.Ltd(600060) (- 12.04%) and Guangdong Sunwill Precising Plastic Co.Ltd(002676) (- 10.79%). In February, the overall valuation of the home appliance industry continued to decline, ranking in the middle and lower reaches of 30 CITIC first-class industries. From the perspective of valuation, as of February 28, the current overall valuation of the home appliance industry is 17.1 times (pe-ttm, excluding negative values), and the valuation premium rate compared with CSI 300 is 136.04%. The valuation of each sub sector also continued to decline, including 14.17 times for white appliances, 19.55 times for black appliances, 22.11 times for small appliances, 31.05 times for lighting electricians and other sectors, and 21.22 times for kitchen appliances.
Industry operation data
Air conditioning: output: affected by the high base in the same period last year, China’s cumulative output of air conditioners increased slightly from January to February this year, reaching 29.259 million units, a year-on-year increase of 3.9%. According to the latest production scheduling, according to the industry online data, the production scheduling of household air conditioning industry was about 17.36 million units in March 2022, an increase of 3.1% over the same period last year. The production scheduling data in March increased slightly, mainly because air conditioning manufacturers began to prepare for the peak season and increased the stock since March. Sales volume and price: according to the statistics of ovicloud, the offline sales volume of household air conditioner in February increased by 69.81% year-on-year, the sales volume increased by 48.05% year-on-year, and the average price was 3956 yuan, an increase of 524 yuan year-on-year. In February, the online sales volume of household air conditioners increased by 128.04% year-on-year, the sales volume increased by 96.46% year-on-year, and the average price was 3395 yuan, an increase of 470 yuan year-on-year.
Refrigerators: in terms of output: from January to February 2022, the cumulative output of household refrigerators in China reached 11.94 million, a year-on-year decrease of 2.5%. Sales volume: according to the statistics of ovicloud, in February 2022, the single month sales volume of the refrigerator line decreased by 23.92% year-on-year, and the sales volume decreased by 34.8% year-on-year. In February, the monthly sales volume of refrigerator online increased by 13.69% year-on-year, and the sales volume decreased by 7.34% year-on-year. Price: the average price of the refrigerator industry has increased significantly since last year. According to the statistics of ovicloud, in February 2022, the offline average price of the refrigerator industry was 5210 yuan, an increase of 758 yuan year-on-year; The average online price of the refrigerator industry was 1996 yuan, a year-on-year decrease of 147 yuan.
Washing machines: in terms of output: from January to February 2022, the cumulative output of domestic washing machines in China reached 13.803 million, an increase of 5% year-on-year. Sales volume: according to the statistics of ovicloud, the monthly sales volume of washing machine line in February decreased by 7.15% year-on-year, and the sales volume decreased by 18.41% year-on-year. In February, the monthly sales volume of washing machine online increased by 20.68% year-on-year, and the sales volume increased by 16.12% year-on-year.
In terms of raw materials, the household appliance industry is mainly composed of aluminum, copper and plastics. Since 2020, the price of raw materials in the home appliance industry has been rising. Recently, affected by the intensification of geopolitical conflict, the price of upstream raw materials and shipping prices have continued to operate at a high level and improved, and the profitability of enterprises is under pressure. As of March 17, the spot settlement price of LME aluminum was US $3321 / ton, up 55.7% year-on-year; LME copper spot settlement price was US $10231 / ton, with a year-on-year increase of 21.82%; The spot price of 1mm cold-rolled ordinary sheet was 5551 yuan / ton, up 6.85% year-on-year.
Investment advice
Looking back on February, the market risk appetite decreased significantly, the market of household appliances was relatively depressed, and the valuation continued to fall. On the cost side, affected by the intensification of geopolitical conflict, the upstream raw material prices and shipping prices continued to operate at a high level and improved, and the profitability of enterprises was under pressure. In terms of demand, many places in China were affected by the epidemic, resulting in the closure of some offline stores and the normal operation of logistics, which affected terminal sales. From the perspective of policy, the 2022 government work report proposed to continue to support the consumption of new energy vehicles and encourage local governments to carry out green smart appliances to the countryside and trade in the old for the new. We believe that encouraging local governments to carry out green smart appliances to the countryside and trade in the old for the new will further stimulate the Consumption Willingness of township and rural areas and release demand. At the same time, it will further enhance the penetration of green smart appliances in the sinking market. Low carbon, green and intelligent will become a new trend in the transformation and upgrading of the household appliance industry, promote the optimization and adjustment of household appliance product structure, and help to improve the profitability of enterprises.
To sum up, the industry is given a “optimistic” rating for the time being. In terms of investment suggestions: white power sector suggests paying attention to Midea Group Co.Ltd(000333) ( Midea Group Co.Ltd(000333) ), Haier Smart Home Co.Ltd(600690) ( Haier Smart Home Co.Ltd(600690) ), Gree Electric Appliances Inc.Of Zhuhai(000651) ( Gree Electric Appliances Inc.Of Zhuhai(000651) ); Kitchen electricity sector: the prosperity of emerging household appliances such as integrated stoves and dishwashers continues. It is recommended to pay attention to the leaders of emerging household appliances industry enjoying high growth dividends of the industry, and Zhejiang Meida Industrial Co.Ltd(002677) ( Zhejiang Meida Industrial Co.Ltd(002677) ), Zhejiang Entive Smart Kitchen Appliance Co.Ltd(300911) ( Zhejiang Entive Smart Kitchen Appliance Co.Ltd(300911) ), Marssenger Kitchenware Co.Ltd(300894) ( Marssenger Kitchenware Co.Ltd(300894) ); Small household appliances: it is recommended to pay attention to Shenzhen Crastal Technology Co.Ltd(300824) ( Shenzhen Crastal Technology Co.Ltd(300824) ).
Risk tips
The risk of macroeconomic environment fluctuation; The risk of repeated outbreaks; Risk of exchange loss caused by exchange rate fluctuation; The risk of serious decline in the end demand of the industry; The risk of declining prosperity of overseas exports.
