Core Insights - The textile and apparel industry is expected to face pressure in 2025, with brand performance remaining subdued and manufacturing exports impacted by tariffs [1][2] - In 2026, manufacturing is anticipated to stabilize before brands, with investment opportunities focusing on resilient sectors such as outdoor sports, quality manufacturing firms benefiting from order recovery, and companies innovating in products and marketing [1][3] Industry Overview 2025 - Industry data indicates that apparel brand retail sales growth is slow, and textile manufacturing exports are weakening due to tariff impacts. Despite a low base in Q2 and Q3, growth accelerated in September and October [2] - The textile manufacturing sector experienced a high start but a decline in performance, while revenue drops in apparel and home textiles have narrowed. The sportswear segment showed better revenue growth, and online channels outperformed offline for home textiles [2] - The A-share textile and apparel index underperformed the broader market, with continuous downward adjustments in brand expectations and slow valuation increases in manufacturing [2] Outlook for 2026 - The textile manufacturing sector is expected to stabilize before the apparel sector, with structural opportunities in the industry. Key areas include the dominance of sports and outdoor categories, strong online growth driven by major home textile products, and new brands leveraging social media marketing and product iterations [3] - Brands with mid-to-high pricing power, the ability to explore niche markets, and innovative product offerings are likely to stand out in a cautious consumption environment [3] Manufacturing Opportunities - Tariff disruptions are showing signs of stabilization, with a recovery trend in exports of footwear and apparel products. Some raw materials, like wool, have seen a short-term price rebound [4] - Textile manufacturing firms are experiencing order pressures, but as tariff costs are gradually passed down, expectations for order stabilization have improved for Q4 and early next year. Companies with strong new product development and efficiency management are viewed favorably for both fundamental and valuation growth [4] Investment Recommendations - Investment focus should be on three main areas: outdoor sports, quality manufacturing, and brand innovation. The outdoor sports sector is expected to have long-term growth advantages, while brands that can innovate products and drive structural price increases are also promising [5] - Specific companies to watch include Anta Sports, Li Ning, and Xtep in the sports sector; Shenzhou International, Huali Group, and Kai Run in manufacturing; and Bosideng and Haier in the apparel and home textile sector [5]