Core view
Market review. Since April, the top five companies in the A-share light industry sector are Oppein Home Group Inc(603833) , Suofeiya Home Collection Co.Ltd(002572) , Shandong Sun Paper Co.Ltd(002078) , Shantou Dongfeng Printing Co.Ltd(601515) , Gongniu Group Co.Ltd(603195) ; Since April, the top five companies in the light industry sector of Hong Kong stocks are blue moon group, Tongfang Youyou, Zhisheng Group Holdings, Shuncheng and Nine Dragons Paper. The valuation of the light industry sector is basically at a historical low in the past two years. Compared with the valuation of the worst period of China’s epidemic in March 2020, the valuation of most of the targets still has a large decline.
In March, the growth rate of China’s consumption fell, and the growth of furniture exports accelerated. In March, the social security zero was – 3.5% year-on-year. In terms of light industry, the retail sales of cultural and office supplies increased steadily, with a year-on-year increase of 9.8% in March; Retail sales of daily necessities were – 0.8% year-on-year in March. The retail sales of furniture in March was – 8.8% year-on-year. In March, the export volume of furniture accelerated year-on-year, and the growth of pulp, paper and its products slowed down: the export volume of furniture and its parts increased by 7.1% year-on-year in March; The export volume of pulp, paper and its products increased by 0.2% year-on-year.
Pulp and paper prices basically stabilized. This week, the price of outer pulp stabilized, while the price of inner broad-leaved pulp fell year-on-year. In terms of cultural paper, the increase was gradually implemented due to the upward impact of pulp cost. The supply and demand pressure of double offset paper continued to increase, and the market price rose slightly in a stable manner. Affected by the epidemic, printing plants in many places across the country are under operated, the delivery and logistics are limited, and the transaction is relatively low. Supplementary teaching materials have just started to be supplied through bidding, and social demand has decreased. After the price increase of the paper mill, the dealers and terminal printing factories are less willing to accept the price increase. In terms of packaging paper, the market supply and demand is temporarily stable.
The growth rate of real estate transaction construction continued to fluctuate downward trend. On the supply side, the performance of real estate sales, commencement and completion in March is still weak. See the situation of the current month for details: the newly started residential area in March was – 25.1% year-on-year; In March, the completed residential area was – 15.3% year-on-year; In March, the residential sales area was – 23.2% year-on-year.
Online data: Sales of household cleaning products tmall grew steadily in March. Tmall flagship stores ranked among the top five in terms of sales growth in the light industry sector were Vader, freepoint, blue moon, Qingfeng and zhihuashi, with a year-on-year increase of + 41% / 35% / 24% / 20% / 17% respectively.
Company announcement and industry news in light industry sector Suofeiya Home Collection Co.Ltd(002572) , Gongniu Group Co.Ltd(603195) , Huabao international, Shandong Sun Paper Co.Ltd(002078) , Shandong Bohui Paper Industry Co.Ltd(600966) successively released the 2021 annual report Anhui Genuine New Materials Co.Ltd(603429) , smore International released 2022q1 performance forecast; The sales volume of Hongxing Red Star Macalline Group Corporation Ltd(601828) 315 has increased greatly Guangzhou Shangpin Home Collection Co.Ltd(300616) released “little orange store”, aiming to build a light fashion fashion brand home store Suofeiya Home Collection Co.Ltd(002572) said that the whole customized stores have been opened at the terminal one after another
Investment suggestion: those who are optimistic about the performance support strong targets are expected to usher in valuation repair. Focus on recommending high-quality leading enterprises with strong performance support and strong long-term growth certainty. Household is optimistic about the opportunity of valuation recovery after the policy risk stabilizes, focusing on Oppein Home Group Inc(603833) , Suofeiya Home Collection Co.Ltd(002572) ; The household goods sector is optimistic about the marginal improvement opportunities of consumption recovery and cost pressure, and focuses on Chenguang shares and Chongqing Baiya Sanitary Products Co.Ltd(003006) ; The paper packaging sector is optimistic about the opportunity of stabilizing the cost pressure and improving the concentration of the leading enterprises, and it is recommended that Shandong Sun Paper Co.Ltd(002078) ; The tobacco sector is optimistic about medium – and long-term growth opportunities, focusing on Smallworld.
Risk warning: repeated impact of epidemic situation; Real estate construction continued to decline; The competition pattern of the industry has deteriorated.
