The coming consumption season is increasing the profit ability of chemical fiber enterprises

-Huatai Securities High Country March, China's textile and garment exports have warmed up, triggering the market for China's textile industry will appear reversal of expectations. After analyzing the inventory data of American Apparel industry, we think that the increase of export data in March is the result of the replenishment of foreign clothing wholesalers.　　Foreign economies have bottomed out, demand has warmed up, but the reversal has not yet come true. May export chain will rise in China's textile industry, one of the biggest characteristics is a high degree of external dependence. In the short term, the premise of the textile industry reversal is that the United States, the European Union, Japan and other major export countries to improve the economy, consumer spending on clothing back to normal levels in previous years.　　This will promote the export of our textiles. In March, the consumer confidence index for the United States and the European Union was 57.3 to 31.7 respectively. The US has improved, the European Union has declined slightly, but is still hovering low. Unemployment in the United States, Japan and the European Union climbed at 8.5%, 4.8% and 8.48%, respectively, in March. The apparel Sales index for big stores in Japan hit a new low in March, at 78.4. This is the lowest point since 2007. shows that Japanese consumption is still in the mire. All consumption-related indicators cannot support the conclusion that the economy will be reversed immediately.　　However, the consumer confidence index has stabilized in recent three months, and developed economies have bottomed out. 4-August is China's textile and garment export peak season, the May export link is expected to rise.　　But with March wholesaler replenishment inventory completed, 4 May year-on-year data is not optimistic. Enhancement of profitability in chemical fiber enterprises in the March tracking report, we pointed out that the 2009 demand will shrink, thereby reducing the business income.　　But 2008 because of the huge increase in oil prices, resulting in the enterprise raw material prices rose too fast, and downstream demand is not flourishing, product sales resistance, unable to raise prices, eventually led to raw materials, product price upside down, which is the 2008 textile, chemical fiber enterprises loss reasons. The price of raw materials purchased by companies also fell significantly in 2009, along with the fall in oil prices.　　The gradual rationalization of the price of raw materials and products helps enterprises to enhance profitability.　　At the current price level of raw materials and products, polyester, viscose, spandex are beginning to achieve profitability, compared with the same level in 2008, viscose, spandex profitability has declined, but with the arrival of clothing sales season, is expected to rebound downstream demand, chemical fiber prices will rise, profitability will be strengthened. Chemical fiber industry will benefit from the increase in textile demand, some chemical fiber began to price. Since this year, polyester, spandex have raised prices, the first quarter, polyester leading enterprises to achieve profitability. Viscose, spandex industry in the break-even state. Viscose, spandex May price increase requirements, chemical fiber prices, corporate profitability will rise, the chemical fiber industry "overweight" rating. To the domestic apparel business growth is clear, maintain "overweight" rating.