Looking At The Investment Opportunities Of Men'S Clothing Industry From Wool Price Decline

Forecast 2012/13 Global

Output is 1 million 55 thousand tons and consumption is 1 million 45 thousand tons.

The largest producer of wool is Australia, the largest producer of which is China, and the largest consumer area is the European Union.

Soaring period: since September 2010, -2011 rose more than 60% in June, mainly due to the increasing demand for wool in China in the years of June, and the large number of wool processing countries in China, which also brought huge speculative demand. The second is the initial callback period: from September June 2011 to September, prices dropped by about 15%, mainly due to the decrease in speculative demand brought about by the ebb of liquidity, and the third was the callback period: from January 2012 to September in September -2012, prices dropped by about 20%, mainly under the influence of the European debt crisis. Europe's consumption demand for wool began to shrink significantly, and the demand in other regions was also greatly reduced, and the demand in other regions was also affected by the recession, which could not make up for the decrease in European demand, thus making prices decline all the way. In the past 2 years, the price of change has three periods: one

In view of the fact that there are 3-4 quarters of time lag in the purchase of ready to wear clothes for sale in the middle of the garment industry, the decrease in the price of a wave of wool prices since the beginning of the year has been reflected in the gross profit margin of the company since the beginning of the 12Q3 season, while the number of men's suits is the largest and the use of wool in autumn and winter products is more.

We made a brief separation of the production cost of the suit, which accounts for about 60% of the total cost.

Chinese clothing and other woollen ingredients account for 35-40%.

We believe that under the background of no substantial recovery in the European debt crisis, the downturn in wool prices will continue. Therefore, the process of gross margin increase will continue in the next 2-4 quarters.

We reckon that under the assumption that the proportion of wool materials is not constant and the price of products in 13 years is not increased, the cost of wool materials has dropped by 20% since the beginning of the year. The impact on the following 4 men's clothing enterprises is as follows: in the next 1 years, the gross profit margin of 1.5-2% will be raised. According to the size of the impact, it will be ranked as seven wolves, nine shepherd kings, good news birds, and card slave road. The growth rate of 4-10%'s net interest rate will be raised. It is located at the intersection of north of Zhengshang Road, West of the West Fourth Ring Road and the textile and garment industrial park. It is one of the leading projects in the planning of "livable Trade City" in Western Zhengzhou.

The textile and textile exhibition and trade complex in Central China is one of the leading light textile exhibitions and trade complexes in Central China.

According to the size of influence, it is sorted into seven wolves, good news birds, nine herdmen, and card slave road.

Investment advice: for

The view is: 1, 10 and 11 years of accumulated inventory of industry has begun to show pressure, so the 13 year spring and summer orders will increase the growth rate of men's clothing companies than the same period 10-20%; 2, the men's wear plate in the semi annual report has dropped about 30%, has fully reflected the decline in the growth rate of 13 year orders; 3, although the expected first half of the year 13 consumption will not improve significantly, but the men's clothing enterprises are still in the extension of expansion can also ensure a certain increase in income; 4, without considering the brand value added product price increase factor, we calculate the men's clothing enterprises gross margin can still increase 1.5-2%, net profit growth can increase 4-10%, this is other clothing sub industry does not have the opportunity. Our

Therefore, compared with the clothing sector, men's clothing industry is more likely to achieve results beyond the market expectations, investment opportunities have begun to appear.