Market review: in the past two weeks, the top five companies in the A-share textile and garment sector are Comefly Outdoor Co.Ltd(603908) , Zhejiang Jasan Holding Group Co.Ltd(603558) , Sichuan Langsha Holding Ltd(600137) , Zhejiang Giuseppe Garment Co.Ltd(002687) , and baibaolong respectively; In the past two weeks, the top five companies in the textile and garment sector of Hong Kong stocks were Sijie global, Baosheng international, Jiuxing holdings, winner fashion and Yongsheng new materials. Looking at the PE (next 12 months) range of the company in the past two years, after recent adjustment, the P / E ratio of most A-share and Hong Kong stock related companies is at the bottom of historical valuation. With the release of favorable signals from the policy side, most A-share and Hong Kong stock related companies begin to rebound. We suggest paying attention to the allocation opportunities after the valuation correction of high-quality companies.
Data tracking: in March 2022, social zero decreased by 0.4% year-on-year, clothing retail decreased by 12.7% year-on-year, and online retail of clothing commodities increased by 0.9% year-on-year, mainly due to the impact of last year’s high base and repeated epidemics; In terms of exports, the high base in February showed rapid growth in March. In March, the amount of China’s textile exports increased by 22.2% year-on-year, and the amount of China’s clothing exports increased by 10% year-on-year. Vietnam’s textile exports increased by 22%. The price of raw materials was basically flat. On April 18, 328 cotton price index (yuan / ton) was 22732, a month on month decrease of 0.7%; The price of nylon 66 chips in the past week was 39000 yuan / ton, a month on week -0.85%. Among the official flagship stores of tmall sportswear focused on in March, Salomon, archeryx Archaeopteryx, kolonsport, bosden, Biem.L.Fdlkk Garment Co.Ltd(002832) , increased by 148%, 77%, 66%, 55% and 50% respectively. From the perspective of trembling data, the ranking of brands that tiktok focuses on sports is fluctuating slightly. There are many categories of men’s wear, the ranking of brands has declined, and Hla Group Corp.Ltd(600398) performs well; The ranking of key brands in women’s clothing category fluctuates greatly, and teenie, weenie, dzzit and Lanzi perform well.
Industry trends: Fast Retailing group and Hermes announced the latest performance; PVH announces the three-year strategic plan.
Investment suggestion: Recently, the annual reports of textile and clothing companies have successively disclosed that sports brands at home and abroad have shown brilliant performance and operating efficiency. Since mid March, the epidemic has had a significant negative impact on the fundamentals and valuation of the sector, but it does not affect the potential improvement of medium and long-term high-quality local sports brands and the growth prospects of the industry. Some manufacturing enterprises are affected by downstream demand transmission, but the companies with the advantage of share improvement still have a dominant growth. From the recent data, the cost pressure is gradually controllable. We are optimistic about the fundamentals and the opportunity for the rebound of valuation under the background of historical low valuation. Hong Kong stocks mainly recommend Li Ning, Anta sports, Shenzhou International, Tebu international, Bosideng and taobo, and A-Shares mainly recommend Huali Industrial Group Company Limited(300979) , Zhe Jiang Taihua New Material Co.Ltd(603055) , Zhejiang Weixing Industrial Development Co.Ltd(002003) , Biem.L.Fdlkk Garment Co.Ltd(002832) , Zhejiang Sunrise Garment Group Co.Ltd(605138) .
Risk tips: 1. Repeated epidemic situation; 2. Deterioration of competition; 3. Damaged brand image; 4. The price of raw materials fluctuates greatly; 5. Systemic risk.
