Shenzhou International Sales And Net Profit Growth In The First Half Is Expected To Grow

According to the world clothing shoes and hats net,

As the manufacturing industry chills and expects pformation, 2313.HK, headquartered in Ningbo, Zhejiang, continues to release the good news.

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The giant garment manufacturer Shenzhou International made more than 24.1% yuan to 17.987 yuan (RMB) in the first half of 2017, compared with 1 billion 449 million 900 thousand yuan in the same period last year.

Industry comparison:

In the 1-6 month of 2017, China's textile and garment industry was pressurized by the continuous rise in costs and the weakening of the traditional industrial advantages. The exports of the three main markets, including the European Union, the United States and Japan, continued to decline. The export volume of knitted garments in the first half of the export garment products was $26 billion 990 million, down 9.5% on a yearly basis.

However, Shen Zhou International's China Daily reported that the company's revenue in the first half of the year was 8 billion 263 million 600 thousand, an increase of 18.9% compared with 6 billion 951 million 800 thousand yuan in the same period in 2016.

Shen Zhou International said that the main reason for its favorable growth is to benefit from

The expansion of the production base has increased the company's production capacity, while staff productivity continues to increase, and orders from major customers continue to grow.

Department performance:

In the three main categories of Shenzhou International, there was double-digit growth in sports category and leisure category income. Among them, the demand for sports category was particularly strong, and the income in the period was 5 billion 518 million 800 thousand yuan, up 22.9% over the same period. This category accounts for 66.8% of Shenzhou's International income share.

The company said that sales growth of sports products mainly came from the rising demand of international brands in the European market and the US market, and increased demand for sports fabric products.

Underwear products had a 5.5% decline in the first half of the year, mainly due to the reduction of underwear purchases in the mainland market.

Core developments:

Shenzhou International said that the group's overseas production base management and operation movement has made further achievements. The promotion of lean production management and the increase of automation equipment applications have promoted the continuous improvement of production efficiency. While expanding the capacity of overseas bases, the domestic base production line has also been renovated.

Although the rise in labor costs has brought more pressure to business, but in the first half of the year, Shenzhou International gross profit and operating profit increased by 18.1% respectively, and gross margin 31.7% remained basically stable, down 20 basis points.

Big view:

Encouraged by the medium-term results, the big companies on Monday issued a report to sing Shenzhou International.

Bank of America Merrill Lynch reported that in the first half of the year, Shenzhou International performance was better than expected. Sales volume and product average price rose by 14% and 5% respectively year on year. Sales volume was better than expected. The average price increase was pleasantly surprised. The upgrading of product mix offset the impact of RMB depreciation. The bank believes that Shenzhou International can continue to assist the company in obtaining trial production share in terms of R & D, vertical integration, automation and prompt delivery, so it reiterates Shen Zhou's international "buy" rating, and raises its target price from HK $58.8 to HK $66.1, and raises 4% and 5% earnings per annualized forecast for today and next two years.

CLSA said that

In the first half of the year, sales and net profit growth were better than expected. Although the exchange rate environment was unfavorable during the first half of the year, the company still maintained a stable operating profit margin, and Vietnam's workshop began to provide profit contribution, so that the group's net interest rate was expanded, and Vietnam's factory buildings were expected to perform better in the future. Citibank also raised the Shenzhou International target price from HK $59 to HK $66, and reiterated the "buy" rating.

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