The textile industry is not faced with exchange rate problems but vicious competition

The A-share market recently ushered in good news and continued to release. Guojin Securities analysts ** interpret the A-share market's investment strategy for the fourth quarter.

*** Appreciation is not conducive to the medium and long-term development of the textile industry on the textile and apparel industry, ** said that from a fundamental point of view, not the worst time, for the production of textile enterprises, the serious excess production capacity, before the customs The closure of companies has continued to fail; for retail textile companies, sustained growth has been maintained.

Regarding the impact of the appreciation of *** on the textile and garment industry, ** said that appreciation is a unilateral negative impact on the textile industry. The impact of exports is relatively large, but it is more reflected in the medium and long-term development. The biggest unfavorable factors in the short term are the sequelae and severe overcapacity of cotton prices and industry consolidation. Manufacturing textile companies include Luthai, Huafu Color Spinning, and Hangmin shares. Most of the companies in the industry are manufacturing, but many companies have diversified their operations. The adverse impact of the appreciation on the industry is medium and long-term. The biggest troubles are currently three. One is a serious overcapacity, one is a stockpile of finished products due to the plunge in raw materials led by cotton, and the Other is that high-priced raw materials and operating costs push up the selling price. , curb domestic consumer demand. He has always been optimistic about domestic textile and apparel retail companies, such as Septwolves, Jiumuwang, Rollei, Fuanna, Meng Jie, and Weixing. In the fourth quarter, for the manufacturing of garment enterprises, the operation is still difficult to improve, mainly due to the repeated cost pressures and overcapacity, as well as insufficient demand. For retail apparel companies, the rapid growth has been maintained. Appreciation is not the most critical factor for enterprises at present, and its adverse effects are gradually emerging.

For the fourth quarter of the apparel industry's market, ** believes that the annual winter clothing because of high unit prices, the sales amount is the highest in the year, the industry's "spring" should mean the fastest growth. Judging from experience and logic, the listing of the summer dresses in May every year is a benchmark for the market in the year. This year, the growth rate of domestic textile and apparel retail sales declined slightly. This momentum may not stop until the first half of next year. He is most optimistic about the retail sector, although overall growth has declined, but the listed leader is still good.

Some netizens mentioned that the textile industry is not facing the issue of the exchange rate, but rather the industry's vicious competition. In this regard, ** expressed its strong agreement. The industry urgently needs to be integrated. It is hoped that the country will not interrupt this industry integration process and let the market factor play its due role. If industry consolidation is completed in the past few years and the degree of industry concentration is appropriately increased, in the long run, it will be beneficial to the development of Weixing, Luthai and other enterprises.

Regarding the investment strategy of the textile and garment industry, ** stated that textile and clothing are completely competitive industries, and that retail enterprises need to study investment ideas from the bottom up, and need to focus on the management capabilities of the company’s management, so look from the top down I don't agree with the so-called subdivision areas. With regard to listed companies, I am optimistic about companies with excellent texture and stable operations.