Key investment points:
Market review: this week, the home appliance (CITIC) industry index rose by. 36% this week, and the overall performance was relatively excellent. The weekly increase ranked first in the CITIC primary industry index, outperforming the CSI 300 index by 6.75 percentage points in the same period. This week, the electronics industry performed well. Except for the black household appliances sector, the other sub sectors recorded positive earnings, and all sub sectors outperformed the Shanghai and Shenzhen 300 index. In terms of individual stocks, 51 stocks in the home appliance (CITIC) industry performed well this week, accounting for about 65%, 17 with a weekly increase of more than 5% and 8 with a weekly increase of more than 10%; Only 27 stocks in the home appliance (CITIC) industry recorded negative returns this week, accounting for about 34%, including 8 with a weekly decline of more than 5% and 3 with a weekly decline of more than 10%. Valuation: as of January 7, 2022, the overall PE (TTM) of the home appliance (CITIC) industry was about 19.76 times, up 3.73% from last Friday, exceeding the average valuation of the industry since 2017. As of January 7, 2022, the ratio of the overall PE (TTM) of the home appliance (CITIC) industry to the Shanghai and Shenzhen 300pe (TTM) was 1.50 times, which has exceeded the average level of the industry’s relative valuation since 2017.
Raw material prices: steel and aluminum prices picked up this week, while copper prices fell. Since the beginning of 2021, the price of raw materials in the upstream of household appliances has risen sharply, the price of copper and aluminum is still at a historical high, and the price of steel has fallen more. On January 7, 2022, the Shanghai copper index was 69537.12 points, down 1.23% from last Friday; The Shanghai aluminum index was 21121.64 points, up 3.56% from last Friday; The latest steel composite price index was 131.80, up 0.08% month on week.
Industry perspective: maintain the recommended rating of the industry. Recently, ovicloud released “prosperity without growth – sales summary of China’s home appliance market in 2021 and market outlook in 2022”. In 2021, the growth of mature household appliances in China was weak, and the boom of emerging categories remained high. With the continuous weakening of the real estate cycle attribute of the home appliance industry, the industry demand comes more from the renewal of stock, the demand side is gradually stable (especially traditional categories), and the home appliance market as a whole has entered a non growth cycle. Although the saturation of traditional categories of household appliances is high, with the development and change of social demand, the penetration of some emerging categories of household appliances has entered the stage of rapid improvement. In 2022, the demand of China’s home appliance market still exists, and the distribution structure is differentiated; High end, scenario, brand complementarity, alliance with users, product structure optimization and sinking channel optimization will become the development direction of Chinese household appliance enterprises. Under the background of steady economic growth in 2022, China’s home appliance market will usher in “prosperity without growth”. Focus on recommending three leading household appliance enterprises with strong comprehensive strength, Midea Group Co.Ltd(000333) (000333), Haier Smart Home Co.Ltd(600690) (600690), Gree Electric Appliances Inc.Of Zhuhai(000651) (000651); It is recommended to continue to pay attention to the online integrated stove faucet Marssenger Kitchenware Co.Ltd(300894) (300894), the gradually released capacity Zhejiang Sanfer Electric Co.Ltd(605336) (605336), the Intelligent Portable Massager faucet Shenzhen Breo Technology Co.Ltd(688793) (688793), the expected large-scale floor washer Beijing Roborock Technology Co.Ltd(688169) (688169), and the first echelon brand of intelligent micro investment Chengdu Xgimi Technology Co.Ltd(688696) (688696).
Risk tip: the impact of uncertainty in epidemic prevention and control on consumers and industries; The impact of real estate cycle fluctuation; Upstream raw material price fluctuation risk; RMB exchange rate fluctuation risk, etc.
