On Thursday and Friday, the textile and clothing sector outperformed the market. Our analysis is mainly due to: (1) the accelerated depreciation of the RMB from the lowest 6.3 yuan / US dollar to 6.55 yuan / US dollar. Textile and clothing manufacturing, as one of the sectors with a high proportion of exports, is expected to benefit, but the company will also suffer from factors such as long-term contract opposition. (2) The epidemic situation in Shanghai has shown signs of turning point since last weekend.
At present, we recommend three main lines: (1) the first quarterly report is expected to exceed expectations: Bros Eastern Co.Ltd(601339) , Zhejiang Xinao Textiles Inc(603889) , Zhejiang Jasan Holding Group Co.Ltd(603558) , Zhejiang Natural Outdoor Goods Inc(605080) ; (2) The valuation of (3) Growth track and subject less affected by economic slowdown: Comefly Outdoor Co.Ltd(603908) .
Market review: outperforming the Shanghai Composite Index by 8.9pct
This week, the Shanghai Composite Index fell by 3.87%, the gem index fell by 6.66%, the SW textile and garment sector rose by 5.03%, outperforming the Shanghai Composite Index by 8.9pct and the gem index by 11.68pct, of which the SW textile manufacturing rose by 4.06% and the SW clothing and home textile rose by 5.48%. At present, the PE of SW textile and garment industry is 14.55. This week, underwear performed best, with an increase of 13.65%; Outdoor and sports performance was the worst, with a decrease of 2.48%.
Market data tracking: China’s cotton price index fell 0.13% this week
As of April 22, China’s cotton 328 index was 22525 yuan / ton, down 0.13% this week. As of April 22, the price index of China’s imported cotton (1% tariff) was 24181 yuan / ton, down 2.17% this week. As of April 22, the closing price of cotlooka index (1% tariff) was 24433 yuan / ton, down 2.11% this week (compared with April 14). On the whole, the price difference of cotton inside and outside this week was – 1656 yuan / ton, which was 507 yuan / ton lower than that at the end of last week.
As of April 14, the Australian Wool Exchange East market composite index was 1367 Australian cents / kg, equivalent to 6377739 yuan / ton (a $1 = 4.6655 yuan), down 0.15% from 1369 Australian cents / kg on April 7. In March 2022, the total retail sales of clothing, shoes and hats, knitwear and textiles amounted to 96 billion yuan, a year-on-year decrease of 12.7% and a cumulative year-on-year decrease of 0.9%.
According to ecdataway data, in March 2022, China’s garment industry achieved online sales of 43.580 billion yuan, a year-on-year decrease of 21.47%, and the growth rate decreased by 9.01pct compared with February. In terms of sub categories, the sales volume of women’s wear in March was the highest, reaching 11.186 billion yuan, a year-on-year increase of 36.95%; In March, the average unit price of sports shoes was the highest, reaching 292.71 yuan / pair, with a year-on-year increase of 2.95%.
According to the statistics of the General Administration of customs, in March 2022, the export amount of clothing and clothing accessories was US $10.224 billion, a year-on-year decrease of 10.63%.; The cumulative export amount of clothing and clothing accessories in the first three months was US $35.685 billion, a year-on-year increase of 7.18%. In March 2022, the export amount of textile yarn, fabrics and products was 118.25 yuan, with a year-on-year increase of 22.24%. The cumulative export amount of textile yarn, fabrics and products in three months was 36.566 billion US dollars, with a year-on-year increase of 15.10%.
In March 2022, the export volume of oil tarpaulin, canopy and sunshade was 3.017 billion yuan, with a year-on-year increase of 26.02%.
Risk tips
The epidemic broke out again; Fluctuation risk of raw materials; Systemic risk.
