Investment Rating - The report maintains an investment rating of "Synchronize with the market - A" for the textile and apparel industry [1]. Core Views - The textile and apparel industry has shown mixed performance, with notable developments such as Miniso's proposal to spin off TOP TOY for independent listing in Hong Kong, which is expected to enhance operational and financial transparency [2][3][19]. - TOP TOY, a leading brand in the trendy toy sector, has demonstrated significant growth, with revenue increasing from RMB 679 million in 2022 to RMB 1.909 billion in 2024, reflecting a compound annual growth rate (CAGR) of 67.7% [4][20]. - The report highlights the performance of various companies within the industry, with a focus on the growth of sports and entertainment products, which saw a year-on-year increase of 20.6% in the first eight months of 2025 [11]. Summary by Sections Market Performance - The SW textile and apparel sector declined by 2.59% in the week of September 22-26, 2025, underperforming the Shanghai Composite Index, which rose by 1.07% [8][21]. - The textile manufacturing sub-sector fell by 1.75%, while the apparel and home textile sub-sector dropped by 2.89% [21]. Company Developments - TOP TOY's gross margin improved from 19.9% in 2022 to 32.7% in 2024, with self-developed products contributing approximately 50% of revenue by 2025 [5][20]. - The number of TOP TOY stores increased from 117 in 2022 to 293 by mid-2025, indicating strong expansion [5][20]. Industry Data Tracking - In the first eight months of 2025, China's textile and apparel exports amounted to USD 94.513 billion and USD 102.761 billion, respectively, showing a slight increase and a decrease of 1.7% year-on-year [48]. - The retail sales of sports and entertainment products grew by 16.9% in August 2025, indicating robust consumer demand [55]. Industry News - Goyard, a luxury leather brand, reported a 64% increase in revenue to EUR 810 million for the fiscal year ending December 30, 2024, showcasing strong performance in both domestic and international markets [6][65][66]. - Xtep International opened its first overseas running club in Singapore, integrating high-performance running gear with community space, aimed at enhancing the running community [10][67]. - FILA renewed its partnership with the China Open, becoming the exclusive sports shoe and apparel sponsor, and announced initiatives to support youth tennis development [10][69].

Investment Rating - The report suggests a positive outlook for the export chain due to anticipated interest rate cuts by the Federal Reserve, with a recommendation to actively monitor this sector [1][12][13]. Core Insights - The expectation of further interest rate cuts in the U.S. is likely to boost overseas demand, benefiting the manufacturing sector, particularly leading apparel manufacturers who maintain pricing power due to limited capacity [1][12]. - FILA's strategic partnership with the China Open and its multi-brand strategy highlight its resilience against market risks, with continued investment in elite sports expected to enhance brand recognition and market share [2][18]. - Retail data indicates a recovery in clothing sales, with a 3.1% year-on-year increase in August, driven by seasonal promotions and improved consumer demand [3][20]. Summary by Sections Industry Investment Rating - The report indicates a favorable investment environment for the apparel and cosmetics sectors, with specific recommendations for leading companies within these industries [4][33]. Core Insights - The Federal Reserve's anticipated interest rate cuts are expected to positively impact the export chain, with a high probability of two additional cuts this year [1][12]. - FILA's renewal of its sponsorship with the China Open and its appointment of a top tennis player as a brand ambassador are expected to strengthen its market position [2][17]. - August retail data shows a 3.1% increase in clothing sales, indicating a recovery in consumer spending [3][20]. Industry Data Tracking - August saw a 5.1% year-on-year increase in cosmetics retail sales, reflecting a positive trend in consumer spending [27][30]. - The report notes stable raw material prices, with cotton prices showing slight declines, which may impact production costs [22][23]. Investment Recommendations - The report recommends focusing on leading companies in the apparel sector, such as Shenzhou International and Anta, which are expected to benefit from market recovery and strategic initiatives [4][33]. - In the beauty sector, brands with strong recognition and quality, such as Mao Ge Ping, are highlighted for their potential growth [4][34]. Market Review - The report reviews market performance, noting a decline in the textile manufacturing sector, while highlighting individual stock performances within the apparel and beauty industries [5][35].