Recently, the management issued the "Special Action Plan to Boost Consumption", proposing 30 measures in 8 parts to expand the consumption of goods and services in an all-round way. From the perspective of economic data, a number of economic indicators in January and February accelerated compared with the whole of last year, indicating that the economic operation continued to recover and improve. Some industry insiders pointed out that consumption is one of the main driving forces for economic growth, and various policies to promote consumption in the future are expected to further stimulate market demand.

Mother and baby

The market size is expected to continue to increase

Since the implementation of the "three-child policy" in 2021, childcare subsidies have been introduced in many places across the country, focusing on two-child and three-child families, covering the rearing stage of infants and young children aged 0-3. Based on local policies, the subsidy forms include one-time cash incentives and monthly parenting allowances, with an average monthly subsidy amount ranging from several hundred yuan to 1,000 yuan. The policy goal is not only to reduce the cost of family childbirth, but also to stimulate the growth of related industrial chains by stimulating the demand for maternal and infant consumption and childcare services.

This year's "Government Work Report" proposes to formulate policies to promote childbirth and issue childcare subsidies. According to previous data from the National Health Commission, 23 provinces have explored the implementation of birth subsidies at different levels.

In the recently released "Special Action Plan to Boost Consumption", it is also proposed to study the establishment of a childcare subsidy system. Taking Hohhot as an example, its childcare subsidy rules stipulate that 10,000 yuan will be paid at one time for one child, 50,000 yuan for the second child in 5 years, and 100,000 yuan in 10 years for the third child and above; At the same time, it provides mothers with a free "cup of milk a day" benefit for one year.

In the future, there is still room for further optimization of relevant policies. Some market analysts pointed out that policy optimization can consider increasing the amount of subsidies, moderately increasing the three-child subsidy, and exploring the possibility of covering one-child families to enhance the incentive effect of policies. Expand the scope of application, gradually relax the conditions for applying for subsidies, appropriately include the non-registered population who have been working in one place for a long time, and improve the inclusiveness of policies.

Zhang Jing, an analyst at Jianghai Securities, pointed out that under the background of China's aging population and low birth rate, it is imperative to introduce policies to encourage childbirth. In terms of dairy products, the market's fundamental expectations for infant formula companies are expected to be improved and the valuation will increase. The baby products chain recommends paying attention to the child king and baby-friendly room; Toy stationery companies pay attention to Chenguang shares; Focus on infant and child care categories, such as Runben shares, which have strong online explosive creation capabilities.

A selection of potential stocks

Yili shares (600887).

The world's leading dairy product

Factors such as the company's cost reduction, reduction of powder spraying impairment losses, and dilution of expenses after revenue stabilization are expected to release profit elasticity, and maintain the core net profit margin target of 9% in 2025. On this basis, the recent dairy product demand policy has been positive, and if more regions join the ranks of birth subsidies, the prosperity of liquid milk and milk powder is expected to accelerate and improve, which will catalyze the company's revenue and profits. Guotai Junan Securities pointed out that in 2024, the dairy industry will be suppressed by the triple factors of oversupply, weak demand and high inventory, and the price of fresh milk will continue to fall, and the low cost will lead to the deterioration of the competitive landscape. The most pessimistic point for the industry has passed, and combined with the pace of supply and demand, it is expected that the equilibrium point of fresh milk may appear in the third quarter of 2025, when milk prices are expected to stabilize and promote the improvement of the industry pattern. Historically, leading companies have typically improved their gross sales margins during the upward period of milk prices, while reducing some expenses and losses, resulting in profit recovery and market share improvement.

The child king (301078).

It is expected to reshape the business model

The company established a wholly-owned subsidiary, Nanjing Zhiling Future Intelligent Technology Co., Ltd., which is mainly engaged in AI artificial intelligence and other businesses, and will cooperate with domestic AI computing algorithm leading enterprises in the future to create AI companion intelligent products and incubation platforms for mothers, infants and new families. Galaxy Securities pointed out that the company, as the head enterprise of the maternal and infant chain retail track, has more than 1,000 stores and more than 8,000 parenting consultants to accumulate more data assets, which can provide support for the creation of vertical large models for mothers and infants, children and adolescents, super parenting agents, and several professional agents and IP agents. In the medium and long term, after the company's AI agent products are implemented, it can promote the upgrading of the business model to a "comprehensive industry of traffic + service + data + platform". With the "three expansions" strategy that the company will promote since 2024, the company is expected to reshape its business model, and transform from a 0-3-year-old maternal and infant retail channel provider to a comprehensive service provider by improving its digital and intelligent capabilities and the proportion of its own brand.

Baby-friendly room (603214).

Create a second growth curve

In 2021, the company expanded its business scope to Central China through the acquisition of Beibei Bear, and its business has now covered East China, Central China, Southwest China and South China. In the revenue structure, milk powder and offline stores are its main sources. Guohai Securities pointed out that the company, as the leading dealer in China, is deeply bound to Bandai Namco, and has opened a Gundam Base store in Suzhou, which has achieved a market response that exceeds expectations, and the number of stores opened in the country except for super first-tier cities has a large room for growth. In addition, the cooperation of other channel types such as Bandai merchandisers and online business, except for the GUNDAM Base store, is a blank area to be developed. On the whole, with the further improvement of the three-child birth policy and the birth system in the future, the maternal and infant market still has great resilience and growth potential. The company's main business stopped falling and stabilized, and the continuous and in-depth cooperation with Bandai helped the company open the second growth curve.

Runben shares (603193).

The performance growth is outstanding

The company takes mosquito repellent products as the entry point and continues to enrich the categories, adheres to the integrated strategy of research, production and marketing of "big brands, small categories", and has formed three core product series of mosquito repellent products, baby care products and essential oil products. The company's performance growth is outstanding, with the compound growth rate of operating income and net profit attributable to the parent company from 2019 to 2023 being 38.8% and 58.6% respectively. Guosheng Securities pointed out that the company has formed a unique barrier through the C2M model of "perfect self-owned supply chain + online channels", relying on online channels to quickly obtain consumer preferences, and developing and upgrading products guided by market demand. The company's capacity utilization rate and production and sales rate are high, and the scale effect is expected to be gradually strengthened. On the channel side, the company grasped the dividends of content e-commerce with online platforms, and made efforts to promote high growth through channels such as Douyin; Offline, it will deploy a variety of formats such as Pupu Supermarket, Walmart, Sam's, etc., which is expected to become a new driving force for growth and comprehensively enhance brand power, forming a synergistic linkage with online sales.

Cars

Trade-in activates market demand

On the news side, the "Special Action Plan for Boosting Consumption" has repeatedly mentioned automobiles, including increasing support for trade-in, extending the automobile consumption chain, and reducing consumption restrictions in an orderly manner. In particular, increasing the support for trade-in, carrying out the pilot reform of automobile circulation and consumption, expanding the consumption of the automobile aftermarket, cultivating and expanding the main body of second-hand car business, and strengthening information sharing in the automotive field will activate the new consumption momentum of the automobile market.

It can be seen that since the implementation of the trade-in policy, it has played an important role in stimulating consumption, promoting energy conservation and emission reduction, promoting resource recycling, stimulating economic growth and improving the quality of life of residents. Data shows that in 2024, more than 6.8 million cars will be traded-in and more than 1.38 million electric bicycles will be traded-in.

Some industry insiders pointed out that the "Special Action Plan for Boosting Consumption" pointed out that the use of ultra-long-term special treasury bond funds to support local efforts to expand the implementation of consumer goods trade-in, trade-in is still an important melody of this year's auto market. According to the February production and sales data released by the China Association of Automobile Manufacturers, the production and sales data of passenger cars in the month increased by 40.2% and 36.2% year-on-year respectively; The production and sales data of new energy vehicles increased by 91.5% and 87.1% year-on-year, respectively.

From the perspective of "volume", Dong Xiaobin, an analyst at Industrial Securities, pointed out that the trade-in policy in 2025 will be seamlessly connected with last year's subsidy policy, and the scope of the subsidy will be further expanded, and the stimulus effect is expected to be expected, combined with the rhythm of passenger car retail licensing before 2024. Looking forward to 2025, judging from the year-on-year growth rate of monthly retail sales, it is expected that the monthly retail sales data in the first half of the year is expected to maintain a high prosperity. From the perspective of "price", in the second half of 2024, the willingness of luxury brands and joint venture brands to follow up on price reductions will weaken, the trend of price war will slow down, the volume and price margins of the auto sector will improve, and the beta of the sector is expected to start an upward cycle. BYD, Great Wall Motor, Changan Automobile, Yutong Bus, etc. are recommended for the vehicle sector, and Fuyao Glass, Jingwei Hengrun, Keboda, China Automotive Research Institute, Baolong Technology, etc. are recommended for the parts sector.

A selection of potential stocks

BYD (002594).

The scale advantage is obvious

The company recently announced the pricing of the first batch of 21 new models of the intelligent driving version. The facelifted models cover the 70,000 yuan to 200,000 yuan range, including 10 models of Dynasty Network and 11 models of Ocean Network, all of which are equipped with the "Eye of the Gods" high-end intelligent driving system, and the pricing remains unchanged compared with the old model. As a leader in new energy sales, the company has obvious scale advantages, which is expected to drive further cost reduction in intelligent driving configuration. In the context of "technological innovation + cost advantage", the company is expected to open a new round of strong product cycle. Guosheng Securities pointed out that in the domestic market, the trade-in policy continues to exert force, the company's hybrid and pure electric platforms are iterated synchronously, new cars are strong, and the market share is expected to remain high. In the medium and long term, the company's technology label is deeply rooted in the hearts of the people, and the ocean-dynasty-Denza-equation leopard-looking up, the high-end path is clear, and the brand power continues to rise. In the overseas market, the company is expected to strengthen the introduction of models in the short term, and in the medium and long term, it is expected to continue to contribute important increments to the company as overseas factories are successively launched.

Great Wall Motor (601633).

Wait for the new car cycle to begin

The company's Tank 400 gasoline and diesel twin engines were launched in February this year, and the 2025 Tank 300 was officially launched on March 10, and the second-generation Haval Thunder MAX and the new version of Gaoshan have also started promotional activities, which are about to start a new round of facelift and new car cycle; With the acceleration of intelligent driving, the brand reputation and user coverage have been further improved, and domestic sales are expected to increase to 1.13 million units in 2025, a year-on-year increase of 46%. With the start of production at the overseas plant in Brazil and the introduction of a variety of models overseas, overseas sales are expected to reach 550,000 units for the full year, up 20% year-on-year. Shenwan Hongyuan Securities pointed out that the company's sales structure continued to improve, while the proportion of exports continued to increase, and since the third quarter of 2023, the enhancement of its single-quarter profitability has been fully reflected. The sales of Blue Mountain, Raptors and other models have grown rapidly after the replacement, and the performance is expected to continue to grow at a high rate due to the development of intelligence and the opening of the new car cycle in 2025.

Changan Automobile (000625).

Accelerate the product cycle to cash

The company plans to launch 13 new energy models in 2025, covering brands such as Deep Blue, AVATR and Qiyuan. Among them, Deep Blue will launch a 6-seater large-size SUV Deep Blue S09 and a smart sports sedan, and expand its global products to 81 countries; Kaizen will launch the Q07, a mid-size sedan and a compact SUV. AVATR will launch new models including the 12, 07 facelift and 06. In terms of intelligence, Deep Blue has released three full-scene intelligent driving solutions, providing differentiated intelligent driving function configurations based on models at different price points. Donghai Securities pointed out that the company's new model has been unveiled and is expected to be launched in April 2025, which is expected to promote the company's intelligent electric product cycle to accelerate the cash. On the whole, the company's 2025 new energy vehicle planning is intensive, the global strategic layout is clear, and the cooperation with Huawei and CATL is deepened, and the company is optimistic about the company's electric intelligent transformation prospects and global market growth space.

Fuyao Glass (600660).

Mass production of high value-added products

The

increase in the value of the company's bicycle supporting mainly benefited from the upgrading of glass such as the canopy, and the market is worried about the current slowdown in the growth rate of electrification, and the growth slope of the company's automotive glass ASP growth rate has returned to the center. Different from some market views, BYD and other leading car companies have taken the lead in promoting the acceleration of intelligent driving equality, and the penetration rate of intelligence has entered an explosive period, and intelligence will inevitably lead to an increase in the frequency of human-computer interaction. It is expected that in the short term, the growth rate of Fuyao Glass ASP is expected to maintain a high growth rate along with the volume of intelligent products. Industrial Securities pointed out that automotive glass, as an important carrier of human-computer interaction, has improved its functional complexity and product value. At this stage, the rapid outbreak of intelligence, it is expected that Fuyao Glass is also expected to benefit from the increase in intelligent volume, and drive the high growth of ASP in the form of HUD, ADAS windshield, etc. Looking forward to 2025, the company is still in an upward business cycle of capacity utilization, high value-added products, and stable and decreasing costs, and the new factory will be put into operation in 2026, which will open the "ceiling" of the company's upward growth.

Appliances

The industry's prosperity has rebounded

Driven by the national subsidy policy, since 2025, the retail sales of offline major appliances in China have a good growth momentum. According to the data of Aowei cloud network, from January to February, China's online and offline retail sales increased by 1.4% and 10.2% year-on-year respectively. According to the data released by the General Administration of Customs, from January to February, China's home appliance exports reached 109.39 billion yuan, a year-on-year increase of 7.6%, continuing a good growth trend.

In terms of policy, the 2025 government work conference mentioned that it will still vigorously boost consumption, expand domestic demand in all aspects, and implement special actions to boost consumption. Formulate special measures to enhance consumption capacity, increase high-quality supply, and improve the consumption environment, release the potential of diversified and differentiated consumption, and promote the upgrading of consumption quality. At the same time, 300 billion yuan of ultra-long-term special treasury bonds will be arranged this year to support the trade-in of consumer goods.

In addition, the real estate policy continues to increase, and the domestic sales boom of household appliances in 2025 is expected to benefit. In terms of exports, orders continue to be booming, and the emerging markets of the Belt and Road Initiative have a broad space, which is expected to contribute to the increase in exports. At the same time, the renminbi has entered the depreciation channel, and the exchange income of export enterprises is expected to drive profit recovery.

Cai Wenjuan, an analyst at Guotai Junan Securities, said that the marginal data of real estate has picked up, and the kitchen appliances and white appliances sectors with strong correlation with the real estate post-cycle are expected to stabilize. On the whole, it is recommended to pay attention to Midea Group, Robam Appliances, Hisense Video, and Vantage shares; At the same time, all localities actively release the details of parenting subsidies, the policy exceeds expectations, and the increase in fertility rate will directly benefit maternal and infant household appliances and small kitchen appliances. AI+ continues to be hot, optimistic about smart home, wearable devices, AI companion toys and other sub-industries, and companies with high attention to the launch of new products will benefit more. It is recommended to pay attention to Roborock, KTC, Nine Company-WD, EZVIZ Network, etc.

A selection of potential stocks

Midea Group (000333).

The cost-effective advantage is significant

Under the background of weak effective domestic demand and stable overseas markets, the company has achieved steady growth in revenue performance by relying on the business principles of stable profitability and driving growth, demonstrating the profound heritage of the leader. Judging from the situation in the second half of 2024, the company's export orders have accumulated more, and the export growth rate is expected to be maintained in the subsequent quarters. Looking forward to the future, the global home appliance market is broad, and as a white appliance faucet with the highest comprehensive competitiveness, Midea's share is expected to continue to break through and drive further growth in operating performance. China Securities pointed out that from the perspective of growth, the logic of home appliances going overseas is smooth, and it is expected to build a long-term growth track in the overseas market and weak competitive environment, and the continuous increase in the proportion of the domestic high-end market has also broadened the growth space for domestic sales. From the perspective of valuation, under the past PEG investment paradigm, the value of the home appliance sector is still underestimated, compared with historical data and similar asset data, the valuation of the home appliance sector, especially white electricity, is still at a low level, with strong cost performance. The company's investment cost performance advantage at the current time point is more significant, and it is recommended to pay attention to the company's investment value.

Robam appliances (002508).

The performance growth rate is expected to bottom

In the first three quarters of 2024, the company achieved operating income of 7.396 billion yuan, a year-on-year decrease of 6.78%; the net profit attributable to the parent company was 1.202 billion yuan, a year-on-year decrease of 12.44%; The net profit after deduction reached 1.075 billion yuan, a year-on-year decrease of 16.27%. The low prosperity of the upstream will affect the short-term income growth, but it is expected to gradually increase the demand of the industry under the trade-in policy. Haitong Securities pointed out that the company, as a leading brand of kitchen appliances, has a complete channel layout, and in the short term, it will be affected by the real estate boom, and its own business growth in the second and third quarters of 2024 may be under pressure. However, after entering September 2024, the national subsidy will be implemented in various provinces and cities one after another, and the demand for major appliances such as kitchen appliances will be effectively stimulated. As a leading kitchen appliance product and channel layout, the company has given priority to benefiting from the recovery of industry demand, and its performance in the fourth quarter is expected to return to growth. In the long run, the company has a solid position in the main category market, and the new category is expected to continue to increase its business scale under the synergy of brands and channels. The partnership plan clarifies the company's performance goals and ensures that the interests of all levels are aligned.

Roborock (688169).

Continuous product innovation

The company continued to make steady progress in product innovation and maintain its leading position, such as the launch of dual robotic arm mopping modules, chassis lifting functions, etc.; The G30Space, launched in 2025, is the first sweeper on the market with a bionic manipulator. With the penetration of embodied intelligence technology, this will become an important development direction in the future. Galaxy Securities pointed out that sweeping robots have been widely included in smart home, home improvement and other subsidy projects by local governments, and the market will show explosive growth in the fourth quarter of 2024. From 2025 onwards, the company's profit margins are expected to remain at a level similar to that of the fourth quarter of 2024, while its market share is expected to grow rapidly until it is significantly ahead of the second place. If the current strategy continues, the company is expected to occupy the first place in the market share of robot vacuums in China, Europe and the United States. As the company's market share continues to expand and profit margins are expected to stabilize in 2026, the company is expected to re-enter a period of rapid revenue and profit growth in 2026.

Hisense Video (600060).

The inflection point of operation is established

In the fourth quarter of 2024, the company's domestic sales benefited from the rise in the volume and price of national subsidies, and the leading position in the industry was consolidated. According to AVC data, in the fourth quarter of 2024, the share of Hisense's color wire and offline sales was 30.1% and 34.1% respectively, an increase of 3.1 and 1.1% respectively from the first three quarters, which is expected to drive a significant increase in domestic sales revenue in the fourth quarter. In addition, the company's profitability has improved significantly, which is expected to be mainly due to the outstanding results of the upgrading of the domestic sales structure, the accelerated penetration of MiniLED and large-size products, and the increase in profit contribution. Industrial Securities pointed out that the company is the leading domestic color TV, the national subsidy continues to superimpose the Vidda product matrix to complete, the performance inflection point in the fourth quarter of 2024 is established, and it is expected that domestic sales will continue to rise in 2025. In the medium to long term, the company's high-end strategy will continue to advance, and the logic of increasing global market share and improving profitability is expected to continue to be realized.