The epidemic situation in many parts of the country has seriously dragged down social zero performance. In March 2022, the total retail sales of social consumer goods was – 3.5% year-on-year, and the growth rate decreased by 10.2pct compared with January February 2022, After turning negative for the first time since August of 20 years, the epidemic broke out in many places across the country, which seriously inhibited the release of consumer demand and brought weak performance of social zero data. Among them, the compulsory consumption is relatively strong, mainly due to the demand for daily necessities under the epidemic. Grain, oil, food and beverages increased by + 12.5% and + 12.6% year-on-year respectively, and the growth rate increased by 4.6 and 1.2pct month on month respectively, Daily necessities were – 0.8% year-on-year, and the growth rate decreased by 11.5pct. Optional consumption is seriously affected by the epidemic and the overall performance is weak.
Core optional consumer goods showed negative growth, focusing on sectors with greater recovery elasticity after the epidemic. In March, the growth rate of cosmetics was – 6.3% year-on-year, with a month on month decrease of 13.3pct; The growth rate of gold, silver and jewelry was – 17.9% year-on-year, with a month on month decrease of 37.4pct; Catering revenue was – 16.4% year-on-year, of which catering revenue above the limit was – 15.6% year-on-year, and the growth rate decreased by 25.3pct respectively month on month And 25.7 PCT. The serious epidemic situation in Shanghai, Jilin, Hebei and other places has hindered the realization of offline consumption. Affected by the suspension of logistics and transportation, online consumption has also been suppressed to a large extent. Superimposed on the decline of residents’ disposable income and consumption confidence under the epidemic situation, the core optional consumer categories have shown a negative growth trend. However, considering that the number of new cases in Shanghai has passed the peak and Jilin and other places have been well controlled, the national epidemic will not completely improve in the short term, but there is marginal room for improvement. 3.8 promotion Winona, Proya Cosmetics Co.Ltd(603605) , kwadi and other domestic brands have achieved good performance, and the demand for beauty consumption is still relatively strong; Consumption forms such as catering and jewelry are highly dependent on offline consumption scenes. If the epidemic situation improves, there will be more room for recovery. Focus on optional consumption sectors with greater post epidemic recovery elasticity such as catering, jewelry and tax exemption.
The pulling effect of consumption on the offline of the epidemic is more significant, but in the long run, the overall pattern of retail channels has entered a steady state and the trend remains unchanged. In Q1 of 22, the national online retail sales increased by + 6.6% year-on-year, of which the online retail sales of physical goods increased by + 8.8% year-on-year, slightly higher than the growth rate of 0.3% of the whole society. Under the epidemic, the pulling effect on consumption is more significant. In offline channels, the retail sales above Q1 limit of convenience stores and professional stores were + 10.1% and + 6.6% year-on-year respectively, with relatively good performance. In 2012, Q1 online retail sales accounted for 23.2% of the total retail sales of social consumer goods, slightly lower than the level of 2021. We believe that in the long run, with the online channel dividend peaking, the overall pattern of Wuxi Online Offline Communication Information Technology Co.Ltd(300959) retail channel has entered a steady state and the trend remains unchanged.
Investment strategy: the epidemic situation in many parts of the country seriously dragged down the social zero performance in March. We believe that the current epidemic situation in China is still grim, and the consumption situation is still likely to fluctuate due to the impact of the epidemic. In the short term, with the normalization of epidemic prevention and control, pay attention to the optional consumption sectors with greater recovery elasticity under the marginal improvement of epidemic impact, such as duty-free, catering, hotels, gold and jewelry; In the medium and long term, the expansion of the proportion of middle-income groups under the background of common prosperity is expected to promote the marginal demand of optional consumption, and the medium and high-end optional consumption with high quality has more growth potential.
Risk tip: the epidemic situation in many parts of the country is becoming more severe, and the economic recovery is less than expected and exceeds the expected policy.
