This week’s topic: the most significant adverse expansion of home leaders. By the end of 2021, the number of Listed Companies in household products, papermaking, packaging and printing and entertainment products had increased by + 9.1%, + 7.2%, + 3.6% and + 2.1% respectively year-on-year. The number of listed companies of leading enterprises in the household and paper sectors expanded significantly against the trend, including oupai / gujia / Xlinmen Furniture Co.Ltd(603008) respectively + 23.2% / 20.4% / 21.9% year-on-year, and Taiyang / Bohui / Wuzhou respectively + 18.7% / 23.9% / 37.2% year-on-year.
Household: after the epidemic, the demand recovers, the retail reform accelerates, and the sector valuation is expected to be repaired. The valuation of the sector has been lower than that of 2019 with domestic and foreign troubles, and the leading growth under the freezing point of demand is still steady, and the margin has improved; The medium-term growth logic changes to the same store growth, and the anti cycle ability is improved. At the current stage, leading enterprises actively take measures to support dealers, live marketing and store customers in advance to meet the recovery of demand after the epidemic. The effect of family integration orders continues to appear, and the new value chain assembly mode is about to start; Minhua has shifted from store expansion to focus on the optimization of the same store Oppein Home Group Inc(603833) changed the name of star house to platinum & acquired formar, a famous Italian furniture brand, and optimized the brand matrix Suofeiya Home Collection Co.Ltd(002572) launched the press conference of simi and Milana to accelerate the development of big home. 1) Software Home: recommend Jason Furniture (Hangzhou) Co.Ltd(603816) , which has the retail thinking & big home model for continuous verification, focus on Xlinmen Furniture Co.Ltd(603008) , which is in the product & Channel dividend period, and focus on Minhua holdings, which is optimized in the same store. 2) Customized home: recommend card traffic entrance & Oppein Home Group Inc(603833) , the first to promote industrial integration; Focus on Suofeiya Home Collection Co.Ltd(002572) & Qumei Home Furnishings Group Co.Ltd(603818) , diversified Zbom Home Collection Co.Ltd(603801) , Goldenhome Living Co.Ltd(603180) , and Jiangshan Oupai Door Industry Co.Ltd(603208) with reduced bulk risk and high retail growth.
Bulk paper: the pulp paper system vibrates at a high level, and the waste paper system stabilizes at the bottom. 1) Pulp and paper system: mainly at a high price. At present, the supply form of the international pulp market is still severe. According to the new round of quotation from suppliers, the price of wood pulp continued to rise in June. At present, the price of coniferous pulp / broad-leaved pulp is in the historical 100% quantile. It is expected that the high volatility trend of short-term pulp price will continue; It is expected that the improvement of China’s demand and the expansion of import and export scissors will drive the moderate rise of paper prices. 2) Waste paper system: the demand is still weak, and the bottom of the price has gradually stabilized. The downstream demand continues to be weak, and the packaging factory is not willing to replenish the warehouse. Shanghai Pudong Development Bank Co.Ltd(600000) tons of high-grade Kraft linerboard in Guangdong Shanying is put into operation. The pressure of market supply and demand is further amplified, and the bottom of paper price is expected to stabilize gradually. Pay attention to the Shandong Sun Paper Co.Ltd(002078) , which has sustained production capacity, clear market growth and integrated forestry, pulp and paper. It is suggested to pay attention to Shanying International Holdings Co.Ltd(600567) , Shandong Chenming Paper Holdings Limited(000488) , Shandong Bohui Paper Industry Co.Ltd(600966) .
Special paper: the valuation has reached the bottom, waiting for the cost to fall. As of May 20, according to the sales volume, the market value of Xianhe / Wuzhou / huawang tons of paper was 133 / 70 / 209 million yuan / 10000 tons respectively, which has reached an all-time low. With the demand for repair after the epidemic, the price increase continues to be implemented, the volume and price rise together, and the profit is expected to accelerate the recovery. Continue to recommend Xianhe Co.Ltd(603733) , with diversified product layout and clear growth path, and focus on Hangzhou Huawang New Material Technology Co.Ltd(605377) , Quzhou Wuzhou Special Paper Co.Ltd(605007) .
New type of tobacco: the national retail plan has been released one after another, and the pressure of fog core technology in the first quarter has now appeared. In addition to Shanghai and Shandong, all localities have successively announced the number of e-cigarette retail licenses in the region, with a total of 48730. It is expected to be centrally handled and released from June 1 to June 15, and the industry has entered a period of healthy development. In addition, fog core technology released its 2022q1 quarterly report, with revenue of RMB 1.715 billion (year-on-year – 28.5%, month on month – 10.0%), and profit of RMB 362 million (year-on-year – 40.7%, month on month – 32.6%) under non GAAP standards. The pressure on revenue is mainly due to the impact of the epidemic on the production and delivery of factories in Shenzhen, and the pressure on profit is due to changes in product structure and the provision for significant inventory falling price caused by policies. 1) Atomization industry chain: recommend global atomization technology leader smore international, 2) HNB industry chain: focus on Huabao international, Shenzhen Jinjia Group Co.Ltd(002191) , Shanghai Shunho New Materials Technology Co.Ltd(002565) & Shantou Dongfeng Printing Co.Ltd(601515) , Anhui Genuine New Materials Co.Ltd(603429) , Xianhe Co.Ltd(603733) .
Export: the overall demand is weak and the profit turning point is coming. In April 2022, China’s export value was 273.62 billion US dollars (+ 3.90%), of which the export value of furniture and its parts was 6.047 billion US dollars (- 3.04%), mainly due to the weakening of overseas demand and the significant impact of the epidemic on China’s supply chain. However, at present, the suppression of shipping & Epidemic & exchange rate continues to ease, and the export elasticity is expected to accelerate. Joy Kie Corporation Limited(300994) , Healthcare Co.Ltd(603313) , Cocreation Grass Co Ltd(605099) , Loctek Ergonomic Technology Corp(300729) , which focus on the steady growth of demand, rely on the global production capacity to improve the market share, and go to sea with independent brands. The valuation bottom is Henglin Home Furnishings Co.Ltd(603661) , Ue Furniture Co.Ltd(603600) .
Packaging: the impact of raw materials is slowing down, the depreciation of RMB is good, and the profit can be repaired. 1) Paper packaging: with the year-on-year decline of paper price, the slowdown of cost pressure and the downward trend of exchange rate, 3C packaging is recommended to grow steadily, the second growth curve of tobacco and alcohol packaging is set up smoothly, and the upgrading of product structure is expected to drive Shenzhen Yuto Packaging Technology Co.Ltd(002831) , attention Shenzhen Jinjia Group Co.Ltd(002191) . 2) Metal packaging: the increase of canning rate drives the demand upward, and the optimization of pattern boosts the leading bargaining power. Under this background, it is suggested to pay attention to the steady growth of three piece cans – the improvement of the bargaining power of two piece cans, the prominent integration of can making + filling + Packaging design, and cut into food and beverage to create a second growth curve and a diversified Org Technology Co.Ltd(002701) .
Consumption: the epidemic affects the dynamic sales, and grasp the long-term value. Since April, the epidemic has had a negative impact on leading mobile sales. Chenguang has realized delivery allocation through virtual warehouse, waiting for logistics recovery and consumer demand recovery after the epidemic. Continue to pay attention to Chenguang Co., Ltd., which has deep traditional business barriers & new business performance continues to exceed expectations, consolidate the foundation of offline channels & steadily promote the reform of online channels Chongqing Baiya Sanitary Products Co.Ltd(003006) , optimize the product structure C&S Paper Co.Ltd(002511) , improve the omni-channel layout & improve the omni-channel layout & reorganize the team to improve C&S Paper Co.Ltd(002511) .
Risk tip: the epidemic situation has been repeated, the real estate has fallen more than expected, the exchange rate has fluctuated more than expected, and the paper price has risen more than expected.
