Overvaluation Brings Advantages To Textile And Garment Sector Or To Fill Up

On the 24 day of the A share market, the textile and garment sector suddenly rose, and the day rose in the upper reaches. From the beginning of the year, the plate is still in the lower reaches. It is worth noting that the plate is currently down nearly 20% from its April high point. Some analysts pointed out that the previous fall brought the valuation advantage to the plate, and investors could select high-quality stocks for layout.

This year the trend is going up and down.

Wind data show that the overall trend of textile and clothing (CITIC) index this year showed a trend of "ups and downs". In particular, from the end of January to the beginning of April, the plate index has risen by more than 30%, coming out of a bull market; however, since mid April, the plate index has fallen by nearly 20%.

After the ups and downs of the textile and garment sector, the cumulative increase since the beginning of the year has narrowed to 8.44%, ranking the fifth lowest in the 29 CITIC first tier industry index. Overall, the performance is weaker than that in the big market, and is at the bottom of the dilemma. With the same big consumption areas of food and beverage, household appliances and other sectors of the differentiation is obvious, the latter two years this year's increase is 56.3% and 39.62% respectively.

Some analysts say that the overall weakening of the textile and garment sector is related to many factors, such as market preferences, downward pressure on consumption, pressure on Global trade situation, and the depression of textile and garment itself. At present, the overall valuation level of the textile and garment sector is at a low level and has a strong margin of safety. Combined with the recent performance, textile and garment materials will have a marginal improvement. In the first quarter of this year, the overall growth rate of net profit of textile and apparel industry was 2.7%.

There are also market participants said that in the promotion of consumption tax reduction and other policy driven, external environment improvement and other factors, the textile and garment industry is expected to usher in some good, some of the steady growth of the leading stocks are still in the valuation of the relative depression. High end sports and leisure subdivision leaders and low price, undervalued "double low" public clothing head company is expected to harvest more opportunities.

Positive factors appear

Huajin Securities pointed out that at present, the textile and garment sector has accumulated a certain boost factor: as the first half of this year, the total retail sales of social consumer goods increased by 8.4%, and the garment industry in June increased faster than ever; the Ministry of agriculture and rural affairs predicted that the domestic and international cotton prices will remain weak in the short term; the utilization of textile capacity in China in the two quarter dropped compared with the same period last year; the Ministry of Commerce expects that the consumer market will remain stable in the second half of the year.

The agency also pointed out that the clothing high dividend leading white horse has good robust defensive attributes, and this year the business data is good. It is believed that the steady growth of the leading company's market position and the premium of the market share are expected to be further explored in the future. Baima's leading market value, good liquidity and high dividends are also expected to get a higher premium.

The Great Wall Securities said it was concerned about the fundamentals of the China Daily and Featured high-quality track leaders. The agency said that since the two quarter, there has been a marginal improvement in the data of the industry and key companies. In the future, with the landing of policies such as promoting consumption and tax reduction, it is expected that the industry fundamentals will continue to recover in the second half of the year after the elimination of high prime numbers. In addition, there is a clear differentiation between the sub sectors, and the quality track enterprises that are in line with the current consumption trend still have a relatively good growth rate. At the same time, it is predicted that the performance of the leading companies in the China Daily is better than the industry average under the background of their own operation optimization. The suggestion is that the active layout is in the high quality track with the ability of concentrating and upgrading, and the brand leader who has some positive changes in the near future.