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Jiangsu Listed Companies Have Been Trading For Two Days, With A Half Year Revenue Of 259 Million

2020/10/18 13:27:00 46

Revenue

American meteorologist Lorenz once said that a butterfly in the Amazon rainforest of South America, occasionally flapping its wings, may cause a tornado in Texas two weeks later.

To quote it in real life is: a seemingly unrelated, very small thing can eventually bring about great changes.

Since September, many large-scale export-oriented textile enterprises in India have been unable to guarantee normal delivery due to the epidemic situation, while European and American retailers have transferred a number of orders originally produced in India to China in order to ensure the supply of goods during Thanksgiving and Christmas seasons.

A printing and dyeing factory in Zhejiang Province issued an internal document as early as before the national day, saying that there would be no holidays on October 1 for the "National Day" and "Mid Autumn Festival", and each employee would be subsidized 200 yuan, which was reflected in the salary of that month.

The orders of China's textile industry suddenly ushered in a new round of booming period, the order volume continues to rise, and at the same time, the price of textile raw materials is constantly rising, and in the capital market, funds have long been focused on textile concept stocks.

The concept of textile

In addition to the increase of foreign trade orders, the rise of textile concept stocks also came from the domestic demand for "double 11 Shopping Festival". In addition, the cold winter expectation under the "La Nina" climate also increased the market's expectation for winter clothing demand.

Among them, Jujie microfiber has been trading for two consecutive days. The share price of this listed company from Suzhou, Jiangsu Province, has risen from 25 yuan to 44 yuan, nearly doubling.

At the time of listing, the share price of Jujie micro fiber was 23.87 yuan, and the market value was 2.374 billion yuan. Jujie microfiber is a special company. Zhonghongtian, the second generation of the rich, inherits the family business. Shen Song, his brother-in-law, is in charge of the whole company.

According to the introduction, Jujie microfiber belongs to the chemical fiber textile industry in the textile industry, which is mainly the superfine fiber textile subdivision industry. The main products are superfine fiber finished products, superfine fiber imitation leather fabrics, superfine fiber functional fabrics, and superfine fiber dust-free clean products.

According to the prospectus, the revenue of Jujie microfiber in 2016, 2017 and 2018 was 422 million yuan, 433 million yuan and 462 million yuan respectively, and the revenue in the first half of 2019 was 259 million yuan.

However, the main export customer of Jumei microfiber products is decathlon, a French sports goods retailer, accounting for about 70% of its sales revenue.

In addition to Jumei microfiber, the stock price of robust medical, a listed company from Guangzhou, also rose quietly, rising from 120 yuan to 180 yuan this week.

It is understood that robust medical supplies Co., Ltd. is a research and development, production and sales of cotton as the main raw material of medical dressings and consumer goods enterprises.

From 2013 to 2019, the operating income and net profit attributable to the parent company of robust medical services increased from 1.27/0.9 billion yuan to 45.7/550 million yuan respectively, with an average annual compound growth rate of 23.8% and 35.5% respectively.

Affected by the epidemic situation, in the first half of 2020, the sales of medical protective products such as stable medical masks and protective clothing increased significantly, with a business income of 4.18 billion yuan, a year-on-year increase of 98.5%; and the net profit attributable to the mother was 1.03 billion yuan, with a year-on-year increase of 348.9%.

The growth rate of medical dressing market in 2020 is about 8.2 billion yuan, which is much higher than that of the global medical dressing market in 2020. The medical dressing products of robust medical treatment have entered more than 2000 hospitals and nearly 40000 pharmacies in China.

The stock prices of the former two companies also rose. Blum orient was founded in 2004, formerly known as Blum trading, which was established in 1993. In 1998, the company began to carry out fiber dyeing and cotton spinning businesses through horizontal acquisition.

At present, Blum Oriental is mainly engaged in the R & D, production and sales of color spun yarn, including pure cotton color spinning, blended color spinning, etc. Different from the traditional spinning method of "spinning first and then dyeing", color spinning adopts the processing method of "dyeing first, then mixing color".

According to the data of China industry information network, about 90% of the global production capacity of color spinning is concentrated in China, while focusing on China is a "duopoly" pattern.

Along with the textile sector, we can find that clothing and home textiles always need dyes for coloring. Some data show that since the epidemic, the backlog of export dye orders and the stacking of manufacturers' costs have led to the continuous rise in the prices of disperse dyes, and the share prices of dye companies with complete industrial chain of intermediate production capacity have risen.

Today, Zhejiang Longsheng has the highest market value in the dyestuff sector. The shares of ChuanHua Zhilian and Runtu have exceeded 10 billion yuan. These stocks also have their own industrial chains.

"Cold weather" naturally needs to "add clothes". For "troubled autumn" textile people, the cold winter caused by polanyina makes the textile industry hot. Just as the so-called Indian textile industry sneezes, China's textile industry makes a lot of money.

Indian textile industry not to be ignored

Although the Indian textile industry has been hit, the Indian textile industry is famous for its cheap labor and other advantages.

Textile industry is one of the oldest industries in India. It is one of the major export products of India today. Textiles and clothing account for 2% of India's GDP, about 10% of manufacturing and 14% of the total index of industrial production (IIP).

For India, 1995 was a year of free development of domestic economy. The Indian government vigorously developed the manufacturing industry, and the development of textile and clothing industry has made great progress since then, until now it has become the second largest developing country in textile and clothing industry.

The change of India's textile and garment industry's GDP is manifested in the continuous increase in the total output of cloth.

After India joined the World Trade Organization in 1995, the output of cloth showed a rising trend.

In 2003-2004, the total output of cloth increased to 19.281 billion meters. After the cancellation of export quota in 2005, the total output of cloth increased to 19.281 billion meters,

The output of cloth began to show a steady increase, making it 27.196 billion meters in 2008.

Innovation of industrial policy in November 2016, the Indian government adjusted its policies to stimulate industrial growth. In early 2017, the goods and services tax (GST) act, known as the most important bill since the modi government came into power, was passed.

In 2018, the effect of GST tax increase in India gradually appears. The Indian government originally planned to promote consumption upgrading and economic growth by unifying taxes.

In fact, this represents that India's related industries have huge incremental potential, and India has become the largest and most important supplier of yarn production in the world.

Not only in spinning, but also in weaving and textile processing, such as coating, printing and dyeing.

India has signed free trade agreements with many countries, and these countries can directly invest in India's textile industry, so the capacity of India's textile industry is expanding and creating new vitality.

In the past, India's textile industry was mainly characterized by rural handmade textile industry, but today, India's textile industry is forming a city centered textile cluster.

Due to the growth of domestic needs and healthy export trade demand, the rapid rise of the middle class, the continuous increase of consumption income, and the rapid increase of product grade and quantity demand have greatly changed the business philosophy of Indians. On the other hand, the rapid flow of western consumption and fashion into India has also changed the future of India's textile industry.

According to the 2016 statistical yearbook of India, the foreign exchange earning capacity of its textile and garment industry has reached 27% of India's total, with a GDP of 134 billion US dollars, accounting for 14% of the total industrial output value of the country, and its contribution rate to GDP is 3%.

According to the data from the world bank, the added value of India's textile and garment industry accounts for more than 12% of the added value of the manufacturing industry. The average annual growth rate of India's textile and garment products is 12%, and the output value is expected to reach 440 billion US dollars by 2025.

But the new crown epidemic changed everything, with data showing that India's textile exports fell by 5% in the 2019-20 fiscal year. In addition, according to CRISIL research, India's clothing exports are likely to decrease by 30% - 35% due to the new crown pneumonia pandemic.

As India's epidemic prevention and control is not in place, a serious drag on the textile industry could have gone even higher.

Competitive textile industry

In the past 40 years, textile and clothing industry has always been a traditional advantage industry in China, occupying an important position in China's economic development, and an important part of China's transformation from a big agricultural country to an industrial country.

In 1995, China's textile and clothing industry has become the first in the world with a high international market share, and it is still the first in the world.

But in recent years, China's textile industry has declined.

In terms of specific industry profits, from 2016 to 2019, the operating income and total profit of Textile Industrial Enterprises above Designated Size in China tend to decline as a whole. In 2019, the total operating revenue and profit were 2403.81 billion yuan and 100.9 billion yuan respectively, down 2% and 11% year on year.

As of January to June 2020, the total operating revenue and total profit of China's Textile Industrial Enterprises above designated size were 966.94 billion yuan and 40.21 billion yuan, respectively, down 15.6% and 5.6% year on year. In 2020, the industry's profit will decrease greatly.

The profit of textile industry is not only declining, but also its investment scale is also shrinking. In 2019, China's fixed asset investment in textile industry (excluding farmers) will decrease by 8.9% year-on-year, and by the end of January to July 2020, the year-on-year decrease of 17.4% is obvious.

The first reason is that the growth rate of China's domestic textile and garment market is slowing down

There are many reasons for the obvious decline of profit and investment in China's textile industry, one of the main reasons is the slowdown of the growth rate of China's textile and clothing domestic market.

According to the data of the National Bureau of statistics, in 2019, the retail sales of clothing, footwear, knitwear and textiles above the national quota will reach 1351.7 billion yuan, a year-on-year increase of 2.9%, and the growth rate is 5.1 percentage points slower than that in 2018. The retail quota of textiles and clothing will be 590.7 billion yuan from 2020 to 2020.

Reason 2: the export situation of textile industry is grim

The profit of China's textile industry has declined significantly, which is not only affected by the poor domestic sales of domestic textiles and clothing, but also by the significant and profound impact of the decline in the export of textiles and clothing. According to the data of China Customs, the cumulative export value of China's textiles and clothing in 2019 was 280.7 billion US dollars, a year-on-year decrease of 1.5%, and the growth rate was 5.3 percentage points lower than that of the previous year.

According to the latest statistics of the General Administration of Customs of China, in July 2020, China's textile and clothing export volume was 31.294 billion US dollars, with a month on month increase of 7.79%. Among them, the export volume of textiles (including textile yarn, fabrics and products) was 15.976.9 billion US dollars, down 1.11% month on month; the export volume of clothing (including clothing and clothing accessories) was 15.3175 billion US dollars, an increase of 18.97% on a month on month basis.

From January to July 2020, China's textile and garment exports totaled US $156.482 billion, an increase of 5.57% over the same period of last year, of which the cumulative export of textiles was US $90.080.4 billion, with a year-on-year increase of 31.25%; and that of clothing was US $66.402 billion, a year-on-year decrease of 16.58%.

As rivals, the continuous development of global economy makes the competition between China and India increasingly fierce, especially in the textile and clothing industry. As the main textile products of China and India, yarn and cloth are increasingly competitive in the international market.

From 2007 to 2015, China's domestic yarn production increased year by year. In 2015, India's yarn production reached 35.38 million tons.

In contrast, India's yarn production during the same period was much larger than that of China, reaching 41.38 million tons in 2015.

In 2016, the output of Chinese cloth was 89.258 billion meters, while that of India was only 36.959 billion meters.

Based on the above analysis, it is found that China has a comparative advantage in cloth production, while India has a comparative advantage in yarn production.

On the other hand, India imports $460 million worth of synthetic yarn and $360 million of synthetic fabric (nylon) from China every year, as well as accessories such as buttons, zippers, hangers and needles worth more than 140 million US dollars, excluding knitting machines, lace machines and spinning machines.

Due to limited capacity, India relies on China for synthetic fibers, certain textile fibers, yarns and fabrics.

For China's textile industry, China should actively learn from the export advantages of India's textile and garment industry. While continuously improving its competitiveness, the transfer of textile and clothing industry is also imperative. China's textile and clothing industry must realize the optimal allocation of elements and regain new competitive advantages, so as to realize the transformation and upgrading of the textile and clothing industry.

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