Prospects for the Performance of the Home Appliances Industry of Electric Ironing Machines in 2018 and Changes after the Spring Festival

Revenue Preview: Business prudence, estimated 18Q4 revenue growth and 18Q3 equal

On the demand side, the retail prosperity of 18Q4 electric ironing appliances increased slightly during the promotion season, but it is still at a low level. The export of household appliances still insists on a better addition and a better hedging with domestic sales. On the management side, as household appliances enterprises generally adopt the idea of preservation and management since 2018Q3, under the similar situation of 18Q4 occupational environment and 18Q3, it is estimated that the growth rate of 18Q4 sales revenue is similar to that of 18Q3. From the perspective of different sub-sectors, the small household appliances sector has the strongest counter-cyclical income characteristics. It is estimated that the income growth rate of the white appliances sector is equal, and that the income end of the kitchen/lighting sector has a slight downward trend compared with 18Q3.

Profit Preview: Cost surplus begins to release and profit growth is estimated to be slightly higher than revenue

Benefiting from the last round of price surpluses, cost surpluses and low base effect of export affairs, it is estimated that 18Q4 professional surplus will remain relatively stable, and profit growth is estimated to be slightly higher than income growth.

From the perspective of different sub-sectors, the small household appliances sector benefits from the low base and one-off factors of export affairs. The profit growth rate is estimated to be significantly faster than the income, while the profit growth rate of white and kitchen electric/lighting sectors is estimated to be basically equal to the income growth rate.

Prospect of 19H1: New Year or the watershed of fundamentals, cost surplus can support surplus ability

New Year 2019 may be a watershed for fundamentals: before the New Year, due to the automatic shortening of the previous period, many companies achieved stable 18Q4 results, good cash flow and inventory conditions, or more active in operation, coupled with the early New Year, January shipment may have a short-term overhang. After the New Year, under the influence of macro-pressure and high base, it is estimated that shipment will still slow down further, and the business strategy of enterprises will also change from "moderate competition, price-volume rise" to "share-holding, add-on-ensuring". But we are relatively optimistic about the profitable side: a new round of raw material cost surplus is expected to support high professional surplus.

Investment Suggestions: From Common to Dualistic--Judgment in the Bosom and Growth in the Layout

In 2019, the fundamentals of household appliances are still in the process of bottom-searching. The driving force of investment is not the difference of achievement, but the expectation of different funds to the parent. On the one hand, the domestic investors are institutionalized, the voice of overseas funds is gradually enhanced, and the long-term capital share is added, which makes the crater logic of high-quality assets still established; on the other hand, the policy is relaxed and QFII and so on. Under the expectation of incremental capital entering the market, the market risk preference will increase, and the high risk preference fund will layout the growing varieties.

Prospects for the Performance of the Home Appliances Industry of Electric Ironing Machines in 2018 and Changes after the Spring Festival