Core Viewpoint - The retail sector in commercial real estate is experiencing a transformation driven by consumer promotion policies and the expansion of the duty-free economy across major cities in China, leading to increased consumer spending and inbound tourism [3][5][6]. Group 1: Retail Sector Performance - Major retail operators such as CR Land, Longfor Group, and Link REIT are showing varied performance, with some projects achieving significant growth while others struggle with older assets requiring continuous investment [3][9]. - The retail property portfolio of Link REIT in mainland China reported a total revenue and net property income growth of 29.7% and 28.9% respectively, driven by strong performance from specific projects in Shanghai and Shenzhen [9][12]. Group 2: Consumer Promotion Policies - Cities like Shenzhen, Chongqing, and Chengdu have introduced consumer promotion policies aimed at boosting local economies, with initiatives such as the establishment of new retail stores and events to attract consumers [5][6]. - The focus on green consumption and the establishment of new retail formats, such as duty-free shops in urban areas, are part of a broader strategy to enhance consumer engagement and stimulate economic activity [5][8]. Group 3: Experience and Content Enhancement - Existing retail spaces are undergoing significant upgrades to enhance consumer experience, with a shift towards immersive and engaging environments to attract foot traffic [14][17]. - New entrants in the outlet market are leveraging unique themes and experiences to differentiate themselves, such as health and wellness concepts in shopping centers [13][19]. Group 4: Cross-Border E-commerce Expansion - Cross-border e-commerce platforms like TikTok Shop are expanding into new European markets, indicating a strategic move to capture a broader customer base [30][31]. - Domestic platforms are also enhancing their international competitiveness, with initiatives like JD's collaboration with Xiaohongshu to improve conversion rates and customer engagement [34]. Group 5: REITs and Investment Trends - The approval of new consumption infrastructure REITs, such as the China Green Development REIT, reflects a growing trend towards light-asset operations and the optimization of commercial assets [35][36]. - Existing REITs are showing stable operations, with a reported cash distribution rate of 4.19% for the recently restructured Huaxia First Creation Outlet REIT [36][37].

Investment Rating - The industry investment rating is "Positive" and maintained [8] Core Insights - The brand sector shows steady recovery in Q1 under consumer promotion policies, with most companies achieving positive growth, outperforming expectations. The performance varies across sub-sectors, with mid-to-high-end menswear showing strong growth, sports retail maintaining steady growth, and mass brands also experiencing a rebound. Profitability varies due to differentiated cost control and operational leverage [2][4][16] - The manufacturing sector faces short-term pressure as downstream inventory has reached healthy levels, but demand from major export countries is weakening. In Q1, demand from the US and Japan shows marginal weakening. Most brands and retailers have returned to healthy inventory levels, but weak overseas demand is expected to limit replenishment momentum, affecting order elasticity in the related supply chain [2][4][17] Summary by Relevant Sections Brand Sector - Q1 retail sales of clothing and textiles increased by 3.3% year-on-year, with a month-on-month increase of 3.6 percentage points [20] - Mid-to-high-end menswear brands are leading in retail growth, while the sports sector continues to show steady growth. Mass apparel brands are also experiencing a recovery [20][27] Manufacturing Sector - The manufacturing sector is under short-term pressure due to weak demand from major export markets and healthy inventory levels. The overall order placement is cautious, with expectations of further pressure from tariff forecasts [4][28] Key Company Performance - **Wanjian Medical**: Expected Q1 revenue growth of 30%-40%, driven by non-woven products and strong brand power in sanitary napkins [5][40] - **Zhejiang Natural**: Anticipated Q1 revenue growth of 25%-35%, with net profit expected to increase by 50%-100% [5][40] - **Weixing Co.**: Expected Q1 revenue growth of 10%-15% and double-digit net profit growth [5][40] - **Anta Sports**: Expected Q1 revenue growth in the high single digits, with FILA brand showing mid-to-low single-digit growth [6][20] - **361 Degrees**: Anticipated Q1 revenue growth of 10%-15% for adult apparel and around 15% for children's clothing, with e-commerce growth of about 20% [6][20] Inventory and Demand Trends - The inventory levels of most brands and retailers have returned to a healthy state, with the wholesale inventory destocking nearing completion. However, weak overseas demand is expected to limit replenishment momentum [4][28]

Group 1 - New home sales are slowing down, while the used housing market remains resilient, and passenger car sales continue to show strong performance [9][10][19] - In the week of March 10-16, the transaction area of commercial housing in 30 major cities decreased by 26.4% year-on-year, with first, second, and third-tier cities showing declines of 6.0%, 38.2%, and 33.0% respectively [10][16] - The retail sales of passenger cars in February increased by 26.0% year-on-year, driven by the resumption of subsidy policies and stable price expectations from car manufacturers [19][20] Group 2 - Construction demand remains weak, with manufacturing activity showing a slight increase [11][39] - The price of rebar and hot-rolled coils changed by -0.6% and +1.2% week-on-week, respectively, indicating a mixed performance in resource prices [11][26] - The national cement price index increased by 3.1% week-on-week, supported by industry self-discipline and limited production [11][35] Group 3 - Long-distance travel has increased, while the loading capacity of departing ships has decreased year-on-year [12][24] - The passenger volume of subways in major cities increased by 0.9% week-on-week, while the volume of express delivery increased by 20.5% year-on-year [12][24] - The SCFI/BDI index showed a week-on-week change of -8.1% and +19.2%, indicating fluctuations in export activity [12][24] Group 4 - The coal price at Qinhuangdao Port was reported at 681 yuan/ton, with a week-on-week decrease of 1.3% [43][46] - The prices of copper and aluminum increased by 2.8% and 0.7% week-on-week, respectively, driven by expectations of interest rate cuts [47][49] - The total inventory of copper and aluminum decreased by 35,000 tons and 25,000 tons week-on-week, respectively [49][51]