Unconsciously, 2023 is coming to an end amidst various entanglements. Playing a computer game with a sense of history, I still feel that I need to summarize this year. My personal career has encountered a mid-life crisis, so I won’t talk about it. Let’s take a look at the situation of these industries that I have read the financial reports this year.
Popular industries will begin to cool down in 2023. Lithium battery materials and photovoltaic-related industries are the two hottest industries in recent years. This is one of the few emerging industries in the market that can maintain rapid growth and have a large market size.
However, no matter how large the capacity of the industry is, it cannot withstand the overwhelming expansion of production capacity and the growth of supply and demand. Tianqi Lithium Industry's revenue growth has slowed down, Ganfeng Lithium Industry's revenue and net profit have both declined year-on-year, and the growth of the leading lithium material has approached the stage ceiling. However, companies in the back-end power battery business are not bad. The growth in the first two years was not as strong as the materials side. It is still growing steadily, but the growth is also slowing down.
The situation in the photovoltaic materials industry may be slightly better than that of lithium battery materials, but it is not much better. The revenue growth of the industry leader Tongwei Co., Ltd. has slowed down, and the net profit has declined. Although the other leader LONGi Green Energy has maintained a double growth in revenue and net profit, the growth in the first three quarters has slowed down, and both fell in the third quarter. The growth rate is expected to decline throughout the year. Companies engaged in photovoltaic equipment have experienced increases and decreases in revenue, and they have begun to differentiate.
The main reason for the adjustment in these two major industries is the price change brought about by the relationship between supply and demand. Lithium carbonate dropped from more than 500,000 yuan per ton at the beginning of the year to more than 100,000 yuan per ton at the end of the third quarter. At least there has been a stage. The supply oversupply caused the price to plummet, which at least meant that the price returned to rationality. The price of photovoltaic modules is also on a downward trend, but its products are not as good as lithium carbonate products, so it is not easy to make direct price comparisons.
The home appliance industry did not experience a general decline due to the impact of the real estate market as predicted by some experts, but the growth rate still showed a large-scale decline. The top four A-share home appliance companies, Midea, Haier, Gree and Changhong, all have revenue growth within 10%. Home appliances are affected by real estate with a delay, and during the downturn, the industry concentration will increase. That is, small brands will close their doors, while big brands may experience some growth in the short term.
It may be that there is still a process of time delay. Although the revenue of second- and third-tier home appliance brands also rises and falls, the decline is not common. We need to know that more small and medium-sized brands are not eligible for listing. What is the specific situation of these small brands? We can't draw any conclusions from the public financial report data.
It’s impossible not to talk about the real estate industry. Although I rarely read such financial reports throughout the year, or in other words, I rarely share them when I do. The situation of listed real estate companies is relatively difficult. Not to mention that Country Garden, the top student in the industry, has already exploded. Even Vanke, a high-quality real estate company that has long been ranked No. 1, needs state-owned assets to come forward.
The total liabilities of major listed real estate companies are 21 trillion, and the hidden liabilities are about 10 trillion. The debt pressure of 30 trillion is difficult to resolve by other means except selling houses at a higher price. Because the capital of these real estate companies is only about 4 trillion, bankruptcy will not solve the problem. Nearly 70% of listed real estate companies are facing financial pressure in the short term, and their average inventory turnover rate has further dropped to about 13%, and repayment is very slow.
The cement and building materials industry was also affected by the downturn in the real estate industry, with output falling by 2.4% year-on-year, which does not seem serious. Just like the home appliance industry, traditional dominant companies represented by Conch Cement can still maintain revenue growth, but there are not many such companies, and even Conch Cement's profitability is declining.
After restructuring and adjustment in the past few years, new industry giants represented by Tianshan Co., Ltd. that are comparable in scale to Conch Cement will immediately face challenges during the industry downturn, and the entire cement industry will face greater adjustments in the future.
The situation in the automobile industry has become divided. We have heard more in the media that automobile exports have surpassed Japan and become the world's number one, but the actual situation is not all good news.Because in addition to BYD's rapid revenue and net profit growth, only Changan among the top five companies has similar performance. SAIC, Great Wall and GAC are not very optimistic.
What we feel more is that many of the emotional expressions of these car brands on the Internet have far exceeded the scope of normal personal opinions. When the younger generation grows up, they may want to buy some products that are different from their parents' generation to show their individuality. However, if they are fooled once, they will soon have completely opposite ideas. Although this may not necessarily become a reality, and we don’t want it to be the case, it will be difficult to avoid if the vehicle companies do not work hard on quality or quality control.
Industries that support production factors, such as water, electricity, and refined oil, have generally recovered from the trough of the previous two years, and most of them performed well. Has the competitiveness of these companies improved? Let me give you a small example. Take Hebang Biotechnology, a listed chemical company located in Leshan, Sichuan, as an example. Its average natural gas purchase price is 1.69 yuan/cubic meter in 2021, and it has reached 2.31 yuan/cubic meter in the first three quarters of 2023. rice. Sichuan is a province with a large natural gas output, and factor prices have increased by such a magnitude, let alone other places.
The situation in the retail industry is not good either. After the major shareholder of BBK Supermarket became the Xiangtan State-owned Assets Supervision and Administration Commission, the major shareholder of Hongqi Chain also became the Sichuan State-owned Assets Supervision and Administration Commission. Yonghui Supermarket, the industry leader, is still recovering after adjustments, and there is still great uncertainty in the future.
Of course, there are also industries that perform relatively well, such as tourism and hotel industries after the epidemic, as well as industries related to pet users. However, the overall scale of these industries is relatively small, and it is difficult to form support for the entire economy in the short term.
I haven't worked for a public company in nearly 20 years, and the situation in unlisted companies is even worse. For example, the chemical manufacturing company I work for is applying for bankruptcy and reorganization, and there are many cases of bankruptcy and reorganization among related customers.
As someone who has been working in finance, I see more problems than achievements. This must be admitted. However, the entire economic situation is indeed facing great difficulties, including friends around me who feel a deep chill.
Of course, the hope is that the "sensor" on our body is malfunctioning, maybe it is. Fortunately, 2024 has already beckoned to us. This year will see a big reversal. The economy will improve across the board, and will social problems also be greatly improved? hope so!
