Investment Rating - The investment rating for the textile and apparel industry is "Outperform the Market" [2] Core Insights - The textile manufacturing sector continues to show prosperity, while the apparel and home textile segment experiences a slowdown in growth. In 2024, the textile manufacturing sector is expected to benefit from downstream inventory optimization and order rebounds, with revenue projected to grow by 13.7% year-on-year, and gross margin improving by 1.5 percentage points to 16.2%. In contrast, the apparel and home textile sector's revenue growth is expected to slow to 1.0%, with a significant decline in net margin by 4.6 percentage points to 2.3% due to weak consumer demand and rising fixed costs [3][20][27]. Summary by Sections 1. Sector Summary: Textile Manufacturing Continues Prosperity, Apparel and Home Textiles Show Marginal Improvement - In 2024, the textile manufacturing sector's revenue is expected to increase by 13.7% to 41.27 billion, rebounding from a decline of 1.4% in 2023. The apparel and home textile sector's revenue is projected to grow by only 1.0% to 29.71 billion, down from 4.4% in 2023, primarily due to weak terminal consumer demand and intensified market competition [20][27]. 2. Sports Apparel: Industry Maintains Growth Momentum, Significant Brand Differentiation - The sports apparel sector shows strong revenue growth, with Anta increasing by 13.6%, Xtep by 6.5%, and 361 Degrees by 19.6%. However, Li Ning's growth is slower at 3.9%. Profitability is improving, with Anta's core net margin increasing by 0.4 percentage points to 16.8% [3][27]. 3. Casual Home Textiles: Overall Demand Under Pressure, New Business Models and Consumption Lead Growth - Revenue growth in the casual home textile sector is generally slowing, with companies like Bi Yi Le Fen and Senma Apparel showing growth rates of 13.3% and 7.1%, respectively. Most companies are increasing dividend levels, indicating strong cash flow [3][27]. 4. OEM Manufacturing: Order Volume Growth Drives High Prosperity, Companies with Full Orders Show Better Resilience - The textile manufacturing industry is benefiting from the end of the downstream destocking cycle and a return to normal order levels, with significant order volume growth leading to double-digit revenue increases. Major OEM companies like Huayi Group and Shenzhou International are expected to see capital expenditures exceeding 1.5 billion [3][27]. 5. Textile Materials: Export Order Growth Drives Revenue, Profitability Shows High Elasticity - Upstream material suppliers are also benefiting from the replenishment demand from downstream brands, with companies like Taihua New Materials seeing revenue growth close to 40%. Profitability is expected to rebound significantly due to improved gross margins [3][27]. 6. Investment Recommendations - The report suggests focusing on domestic demand growth and resilience, particularly in the textile manufacturing sector, while also highlighting opportunities in the sports apparel segment. Key recommendations include companies benefiting from health consumption and sports industry policies, such as Anta Sports, Li Ning, and Xtep [6][27].