Investment Rating - The report maintains an "Outperform the Market" rating for the home appliance industry [5][6][12]. Core Views - The home appliance sector is expected to recover in 2026, driven by the continuation of national subsidies and stabilization of exports, suggesting a positive outlook for leading white goods companies [1][12][18]. - December retail performance for home appliances showed signs of bottoming out, with significant declines in major appliances but a relatively stable performance in small appliances [1][19]. - The report highlights the resilience of leading companies in the home appliance sector, with a focus on white goods, which are expected to maintain steady growth despite high base effects [12][13]. Summary by Sections 1. Key Recommendations - Recommended companies include Midea Group, Haier Smart Home, TCL Smart Home, Gree Electric Appliances, and Hisense Home Appliances for white goods; Hisense Visual for black goods; and Roborock, Bear Electric, and Ecovacs for small appliances [4][12][13]. 2. December Retail Performance - In December, the retail sales of major appliances saw declines exceeding 20%, while small appliances showed slightly better demand, with air fryers experiencing growth [1][19]. - The offline sales channels for major appliances faced declines of over 40%, while kitchen small appliances remained relatively stable [1][19]. 3. Export Performance - In December, China's home appliance exports decreased by 8.1% year-on-year, with air conditioners facing a significant decline of 20.7% [2][37]. - Other categories like refrigerators and washing machines showed modest growth, indicating a mixed performance across different product lines [2][37]. 4. U.S. Market Insights - U.S. retail sales for home appliances showed a slight increase of 0.8% in November, indicating a gradual return to stable growth despite challenges such as tariffs and inflation [3][43]. - The inventory levels in U.S. appliance stores are returning to normal, suggesting improved market conditions [3][43]. 5. Company Earnings Forecasts - The report provides earnings forecasts for key companies, indicating expected EPS growth for Midea Group, Gree Electric Appliances, and Haier Smart Home, among others, with all rated as "Outperform the Market" [5][76].

Investment Rating - The report maintains an "Outperform the Market" rating for the home appliance industry [5][6][12] Core Insights - The home appliance sector is expected to recover in 2026, driven by the continuation of national subsidies and improvements in export performance. It is recommended to actively invest in leading white goods companies [1][12][18] - December retail performance for home appliances showed signs of bottoming out, with major appliances experiencing a decline of over 20% in domestic retail sales, while small appliances showed slightly better demand [1][19] - The report highlights that the U.S. home appliance retail sales saw a slight increase in November, indicating a gradual return to stable growth despite challenges such as tariffs and inflation [3][12] Summary by Sections 1. Core Recommendations - Key recommendations include investing in leading companies in the white goods sector such as Midea Group, Haier Smart Home, TCL Smart Home, Gree Electric, and Hisense Home Appliances. For small appliances, Stone Technology and Bear Electric are recommended [4][12][13] 2. Research Tracking and Investment Thoughts - December retail performance for home appliances continued to face pressure due to high base effects, with significant declines in major appliances. However, small appliances showed relative stability, particularly in air fryers [1][19] - December exports of home appliances decreased by 8.1% year-on-year, with air conditioners facing the most significant pressure, while refrigerators and washing machines showed modest growth [2][37] - U.S. home appliance retail sales increased by 0.8% year-on-year in November, with inventory levels returning to normal [3][12] 3. Key Data Tracking - The home appliance sector achieved a relative return of +0.23% this week compared to the broader market [49] - Raw material prices for copper and aluminum decreased by 0.5% and 0.7% respectively, while cold-rolled steel prices also saw a decline [51] - Shipping indices for routes to the U.S. West Coast, East Coast, and Europe showed slight increases, indicating a stabilization in shipping costs [64] 4. Company Announcements and Industry Dynamics - Notable company announcements include Midea Group's ongoing efforts in overseas markets and Gree Electric's dividend distribution plans [71][72] - The report discusses the structural adjustments in the air conditioning export market and the anticipated trends for 2026, highlighting the challenges and opportunities in the global supply chain [74]

Investment Rating - The report maintains a "Buy" rating for the home appliance industry, expecting a price increase exceeding 15% over the next 3-6 months compared to the market [42]. Core Insights - The report highlights a rebound in air conditioner production in January 2026 due to a shift in production schedules, although end-user demand is expected to remain weak. Home air conditioner domestic production reached 7.86 million units, up 8.9% year-on-year, while export production was 10.65 million units, up 1.2% year-on-year [13][14]. - Refrigerator production showed a decline in both domestic and export markets, with domestic production at 3.52 million units, down 6.9% year-on-year, and export production at 4.4 million units, down 3.4% year-on-year. The market is experiencing regional differentiation, with emerging markets being the main growth points [16]. - Washing machine production also faced challenges, with domestic production at 3.65 million units, down 4.1% year-on-year, and export production at 4.45 million units, down 0.7% year-on-year. The "trade-in" policy's effectiveness is diminishing, and companies need to innovate to find breakthroughs [17]. Market and Sector Performance - The Shanghai and Shenzhen 300 Index increased by 1.95%, while the home appliance index rose by 0.54%. Notable stock performances included Feike Electric (+24.57%), Jinhai High-Tech (+22.57%), and Tianyin Electromechanical (+17.91%) [20]. - The report tracks raw material prices, noting a 2.62% increase in copper prices and a 1.16% increase in aluminum prices, while cold-rolled steel and plastic prices saw slight declines [24]. - The exchange rate for USD to RMB was reported at 7.04, with a slight decrease of 0.02% week-on-week, and container shipping rates showed a small increase of 1.95% [27]. Real Estate Data - Real estate data for November 2025 indicates a significant decline in new construction, with a year-on-year decrease of 20% in new starts, 10% in construction, and 20.2% in completions. Sales also fell by 8.9% year-on-year, indicating ongoing pressure on the home appliance sector's long-term demand [31][32]. Investment Recommendations - The report suggests that leading brands are likely to achieve stable growth due to their integrated advantages and strong pricing power. The external market is expected to benefit from a potential recovery in the U.S. housing market and gradual improvement in European consumption. Emerging markets are anticipated to maintain strong demand due to demographic advantages [40]. Recommended companies include Hisense, Midea Group, Haier, and TCL Electronics [40].