Needed to speed up the apparel retail market and accelerate the growth of branded apparel

Editor's Note: In high-end apparel products, consumers are less sensitive to price and brand premium.

From the perspective of the industry, the total retail sales of consumer goods in 2011 was 18.391 billion yuan, a year-on-year increase of 17.1%. Among the retail sales of enterprises above designated size, the retail sales of apparel reached 571.27 billion yuan, a year-on-year increase of 25.1%, and the growth rate was much higher than that of the society. Consumer goods retail growth and domestic GDP growth. However, the retail sales of 100 major retail enterprises nationwide increased by 6.1% in January-February 2012, a record low, and the cumulative volume of retail sales fell 4.23% year-on-year. On the one hand, the suppression of terminal demand by high-priced products, the uncertainty of the economic situation has led to cautious consumer spending and other reasons, together led to a significant decline in consumer growth, the growth rate fell to single digits is very rare for many years, it can be said that domestic clothing consumption is The bottom of the slow decline in growth rate, and as the CPI declines month by month, the national pro-consumption policy is gradually promoted, the disposable income of residents increases and the weather gradually picks up, people’s willingness to consume will gradually release, the bottom is basically clear, and clothing consumption increases. Speed ​​will gradually rise. It seems that the short-term industry downturn is a better time to invest. In terms of policies, the 12th Five-Year Plan clearly puts forward the brand construction project focusing on the apparel and home textile industries for the first time, focusing on cultivating about 100 garment home textile enterprises with strong innovation capabilities, high market coverage and share, and good corporate operating efficiency. In the past, the investment-pull model shifted to consumption as a breakthrough, and consumption will play an increasingly important role in the proportion of economic structure. Recently, the “2012 Consumer Market Development Report” issued by the China Academy of International Trade and Economic Cooperation under the Ministry of Commerce stated that the contribution of consumption to China’s gross domestic product (GDP) in 2012 will exceed that of investment, and will become the first The first pull of economic growth. From this point of view, clothing retail industry with wide coverage will face favorable policies, and the performance of related listed companies will be further released as the benefits are fulfilled.

Judging from the market performance and fund allocation, in 2011, the trend of the overall market fell, the decline in the brand apparel sector is relatively small, reflecting the better resilience. In the rebound of the broader market in 2012, the textile and apparel sector suffered a downturn due to factors such as the decline in warm winter consumption data last year, resulting in a further reduction in the valuation of the apparel retail industry and the overall valuation of the A shares. At present, the overall price-earnings ratio of the apparel retail industry is about 20 times, which is closer to the bottom area than the premium of all A shares. The valuation advantage is obvious. In addition, in 2012, the global economy was facing uncertainties, and the slowdown in domestic economic growth has become a consensus. Only a few industries in the industry are relatively sure, but the apparel retail sector continues to maintain its growth due to consumption policies. Certainty is high. Individual stocks are both defensive and offensive, and the willingness of funds to be actively deployed is also high, which may exceed the average performance of the market.

In the high-end apparel products, consumers are less sensitive to price and brand premium. Individual stocks, men can be concerned about seven wolves, Canoudi Road, the Annunciation Bird, Jiumu Wang; high-end women's clothing can be concerned about the Long position; casual apparel concerns Summa clothing, Smith Barney apparel.

Editor: Zhang Yonghong