Textile and apparel: Export data is declining, but revenue and profit data are still good

Textile and apparel: Export data is declining, but revenue and profit data are still good

1. The decline was slightly higher than that of the market

In 2008, the decline in the textile and apparel industry was basically the same as that of the Shanghai and Shenzhen 300 Index. The former fell by 69.05% for the whole year, and the latter fell by 66.25%.

Among textile and apparel stocks, only the new stock Meibang Apparel achieved positive growth throughout 2008, while the others all fell. The largest decline was Haixin shares, which fell 79.76% for the whole year.

2. Revenue and profit data are still good

From January to November, the total profit growth rate of the textile industry was 9.26%, and the total profit growth rate of clothing, shoes and hats was 14.30%. The total profit growth rate of these two sub-sectors was 4.9% higher than the profit growth rate of industrial enterprises above designated size nationwide. %. In particular, the profit growth rate of the clothing, footwear and hats industry in the first 11 months increased month-on-month (compared with the previous eight months). We judge that this may be related to the increase in export tax rebates.

3. Export data is declining

Textile and apparel exports have experienced negative growth for five months in 2008. From October to November, there may be a slight improvement due to overseas Christmas factors, but the growth rate is still single digits. It is estimated that exports will grow by 10% in 2009. In November, the growth rate of textile and clothing imports declined sharply, with clothing imports experiencing the largest negative growth of 14.79% since 2007, reflecting that the sluggish domestic consumer market has begun to have a clear response.

IV. The domestic market is still performing well

In November 2008, the total retail sales of consumer goods nationwide reached 979.08 billion yuan, a year-on-year increase of 20.8%. The growth rate declined slightly month-on-month, but it was still good. The growth rate in the first 11 months reached 21.9%. The growth rate data of retail sales of wholesale and retail goods above designated size are not bad either. In November 2008, the retail sales of clothing, shoes, hats, needles, and textiles grew strongly, with a growth rate of 24.17%. Among them, clothing ranked first among the three categories of commodities with a growth rate of 24.17%.

5. Review

We mainly reviewed the situation of companies such as Changshan Co., Ltd. Lutai A and Yike Technology, and believed that Yike Technology has three major driving factors (commissioning, expo and annual fiber conference, etc.), which are currently worthy of attention. We believe that opportunities for individual stocks in the textile and apparel sector will emerge in endlessly in 2009, with bankruptcy, restructuring, export tax rebate increases, and brokerage themes all having their own exciting performances. The overall judgment is that the turning point for improving the fundamentals of the textile and apparel industry has not yet appeared. We still need to wait for opportunities and maintain the “neutral” rating of the industry.

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