SINOLINK SECURITIES·2025-05-04 07:07Investment Rating - The report indicates a positive outlook for the home furnishing sector, driven by domestic consumption stimulus and the recovery of retail channels [1]. Core Insights - The domestic home furnishing sector shows signs of recovery due to national subsidies, while export performance is experiencing marginal decline [4][6]. - The report highlights the performance of leading companies in the sector, which are expected to maintain better profitability due to strategic advantages and effective cost management [26]. Summary by Sections 1. Home Furnishing - Domestic sales in Q1 2025 showed a year-on-year revenue growth of +1.75%, while net profit increased by +7.07% compared to the previous year [13]. - Export figures for the home furnishing sector in Q1 2025 showed a decline of -8.0% year-on-year, indicating a downward trend in overall export sentiment [13]. - The report anticipates that the domestic market will gradually recover, supported by government subsidies and a stabilization in the real estate sector [13]. 1.1 Domestic Sales - Custom Home Furnishing - Retail channels are showing signs of improvement, while bulk channels remain under pressure [20]. - Leading companies are leveraging national subsidies to enhance retail demand, with pre-receipts showing improvement [38]. - Profitability among top-tier companies is improving, with effective cost control and product development strategies [26]. 1.2 Domestic Sales - Soft Home Furnishing - The soft home furnishing sector is under pressure due to real estate downturns, but improvements are noted in Q1 2025 for leading companies like Gujia and Mengbaihe [39]. - Gross margins for major players have shown slight improvements in Q1 2025, indicating a recovery trend [44]. - Pre-receipts for soft home furnishing companies have improved, reflecting a recovery in domestic demand [46]. 1.3 Export Home Furnishing - The overall export sentiment for home furnishings is declining, with a notable drop in export figures for Q1 2025 [51][53]. - Despite the challenges, high-quality enterprises are expected to maintain competitive advantages and better performance [51].