On December 15, the National Bureau of Statistics released the data for November, showing that the total retail sales of consumer goods in November were RMB4,250.5 billion, up 10.1% year-on-year, an increase of 2.5 percentage points from the previous month, and the total retail sales of consumer goods from January to November were RMB42,794.5 billion, up 7.2% year-on-year. Driven by Singles' Day, retail sales have recovered to a certain extent, with daily necessities, catering and automotive industries benefiting the most, while the real estate sector remains sluggish.
*Image source: National Bureau of Statistics
In terms of structure, the average growth rate of major service consumption categories has strengthened significantly. In terms of catering revenue, the catering revenue of units above designated size increased by 24.6% year-on-year in November, and the growth rate increased by 6.6pc compared with October. In terms of commodity retail, the revenue of clothing, shoes and hats, and knitted textiles in November increased by 22% year-on-year, an increase of 14.5pc from October, the revenue of daily necessities increased by 3.5% year-on-year, and the growth rate decreased by 0.9pc from October, and the revenue of cosmetics decreased by 3.5% year-on-year, with a growth rate of 4.6pc from October. In the food category, the revenue of food, beverages, tobacco and alcohol increased slightly year-on-year, and the growth rate changed slightly compared with October. In the upgraded consumer category, the revenue of gold, silver and jewelry increased by 10.7% year-on-year, an increase of 0.3pc from October, and the revenue of sports and recreational goods increased by 16% year-on-year, a decrease of 9.7pc from October. In the transportation category, the revenue of automobiles increased by 14.7% year-on-year, an increase of 3.3pc from October, and the revenue of petroleum and petroleum products increased by 7.2% year-on-year, an increase of 1.8pc from October. In the real estate category, household appliances and audio-visual equipment increased by 2.7% year-on-year, with a growth rate of 6.9pc from October, the revenue from construction and decoration materials decreased by 10.4% year-on-year, and the growth rate decreased by 5.6pc from October, and the revenue from furniture increased by 2.2% year-on-year, with a growth rate of 0.5pc from October.
*Image source: National Bureau of Statistics
Note: The red box circles the projects that are higher than the total amount of social zero year-on-year in November, and the green box circles the projects that are lower than zero year-on-year in November
*Source: National Bureau of Statistics
Clothing, shoes and hats, knitted textiles, food, tobacco and alcohol and other daily consumer goods were affected by the "Double 11" and performed prominently. After the concentrated release of the Mid-Autumn Festival and the National Day, residents' consumption demand for travel has declined, and promotional festivals such as "Double Eleven" have replaced travel consumption for daily consumer goods such as clothing, shoes and hats, knitted textiles, etc., but cosmetics, one of the core categories of "Double Eleven" consumption in previous years, have performed poorly, mainly due to two reasons, one is that the aftermath of the "Li Jiaqi incident in September" has not subsided, and the consumer confidence of cosmetics consumers has been affected by this, and the other is that Japanese beauty products are facing a sales crisis in the Chinese market due to "nuclear pollution". The "Li Jiaqi incident" put the windfall profits of the beauty industry and live streaming on the table, causing consumers to question whether they really bought cost-effective products.
According to Kuaishou data, this year's Double 11, the top 20 Kuaishou anchors in terms of GMV contributed a total of 9.132 billion yuan, a decrease of nearly 18% from 11.135 billion yuan in the same period in 2022, and the core anchors of Xinxuan Group (including Simba and Dandan) reached GMV of 7.014 billion yuan on Double 11 this year, down 22% year-on-year from 8.995 billion last year. In addition, many top live broadcast rooms also said that the influence of top anchors continues to decline. Guojin Securities mentioned in the "Double 11" research report that none of the top 10 brands sold in Tao beauty stores during this year's Double 11 were daily makeup brands. Bai Wenxi, chief economist of IPG China, said that the impact of Japan's nuclear sewage discharge incident on Japanese cosmetics is an important factor, which has led to the continuous fermentation of consumer resistance to Japanese cosmetics. Chinese consumers generally perceive Japanese chemical products as "unsafe" due to the discharge of nuclear wastewater, and they are turning to other alternatives. Japanese makeup and skincare products, which are known as "the most suitable products for Asian skin", were also deeply affected by this incident.
The catering industry was the highlight of the total performance of the company in November. Originally, there were not many holidays left this year, and the number of residents' trips had declined, but judging from the feedback from food and beverage consumption, there were unexpected surprises. In November, Hong Kong-listed catering companies such as Jiumaojiu (09922), Helens (09869), Haidilao (06862), and Xiabu Xiabu (00520) terminated the decline since August, and walked out of the form of rising first and then falling, and the overall flat pattern. Essence International previously pointed out that the offline catering targets of Hong Kong stocks are relatively high-quality, have strong brand power in the subdivision track, and have relatively strong financial strength, and have generally adopted an expansion strategy in the three years of the epidemic, taking advantage of the low market to occupy a better position, and labor and rental costs have decreased. Therefore, the bank believes that the recovery of these listed companies will be higher than the industry average. The current valuation level is low and has entered the layout range. According to the survey, the recovery of catering revenue across the country after the epidemic has been strong, and catering consumption has taken the lead in promoting domestic demand. The pro-consumption policies issued by local governments and the shopping mall consumption coupons implemented by local governments have helped the recovery of catering consumption, and also improved the confidence of merchants in future operations and consumers' willingness to dine. For example, on November 18, Beijing Yanqing District issued the 2023 "About Hui Yanqing Ice and Snow Happy Season" ice and snow catering consumption vouchers, which include ice and snow catering consumption coupons and ski resort catering consumption coupons, which will be used until February 29, 2024, and Changchun City will issue the 2023 Changchun "Ice and Snow Food Festival" with a total amount of 6 million yuan on November 24"Food and beverage vouchers.
Real estate-related consumption data was weak, but the national housing prosperity index in November was 93.42, better than the previous value of 93.4, and the prosperity index rebounded slightly. Among the investment details, the area of new construction started in November was 4.9% year-on-year, and the previous value was -21.1%, and the growth rate of new construction started turned positive. In terms of sources of funds, the growth rate of real estate funding sources was -8.7% in November and -16.8% in October, and the performance of various sub-items improved, among them, the growth rate of domestic loans was 7.3% year-on-year in November and -9.8% in October, the growth rate of deposits and advance receipts was -16.6% in November and -18.6% in October, the growth rate of personal mortgage loans was -13.9% in November and -15% in October, and the growth rate of self-raised funds was -8.3% year-on-year in November and -17.7% in October. According to the monitoring data of the China Index Research Institute, the overall transaction volume of the property market in November decreased month-on-month. Among them, the transaction area of first-tier cities increased slightly by 1.23% month-on-month and decreased by 23.59% year-on-year, of which Shanghai led the increase with 12.31% and Beijing fell by 18.86%. The transaction area of the second-tier cities decreased by 19.79% and 18.01% respectively year-on-year, of which Wuhan decreased significantly, reaching 58.71%. The transaction area of the fourth-tier cities increased by 2.78% month-on-month and decreased by 26.78% year-on-year. It can be seen that the real estate industry is still in the bottom, and the poor performance of real estate in November is expected, reflecting the related construction and decoration materials income is also poor.
Automobile consumption remains stable, and its sustainability is questionable. In the first 11 months of this year, domestic car sales reached 26.938 million, a year-on-year increase of 10.8%, of which, in November this year, car sales were 2.97 million, an increase of 4.1% month-on-month and 27.4% year-on-year. Chen Shihua, Deputy Secretary-General of the China Association of Automobile Manufacturers, said: "In November, the performance of the automobile market continued to improve, exceeding expectations, with automobile production reaching a record high and sales of nearly 3 million units. The popularity of the auto market continued, and with the help of consumption waves such as the Double 11 promotion, the demand for car purchases was further released, and the market performance continued to improve and exceed expectations. In addition, not only dealers have begun to exchange price for volume, but car companies have also launched limited-time preferential policies. According to market news, Lynk & Co announced in the limited-time offer from November 1 to 30 this year that the completion of the Lynk & Co 08 model lock order and the completion of the car pick-up before December 31 can enjoy 6,000 yuan car purchase subsidy and free upgrade worth 10,000 yuan worth of Harman Kardon audio; Haval announced that during November 7-30 this year, the third generation H6 will be purchased DHTPHEV enjoys a limited-time e-commerce subsidy of 1,111 yuan and 15,000 yuan in cash discounts, while Changan Qiyuan will give benefits of up to 30,000 yuan and 19,000 yuan respectively for the A07 and A05 models from November 7 to 30. It can be seen that the rise in retail revenue of automobiles is due to the price war directly or indirectly set off by a number of car companies through price cuts, gifts and other means to attract consumers, but how long can this "non-benign competition" last, whether the car companies themselves can afford it, whether it will have an impact on the future after-sales service, this price reduction is the car companies themselves to make profits or force upstream manufacturers to reduce prices, it remains to be seen, with this way of exchanging price for volume to increase retail sales in the short term The effect is obvious, but it is not a long-term solution.
Employment remained stable. The surveyed urban unemployment rate in November was 5.0%, unchanged from the previous month.
On December 15, the Information Office of the State Council held a press conference, and Liu Aihua, spokesman of the National Bureau of Statistics, introduced the operation of the national economy in November. Domestic demand continued to recover, sales of travel goods improved, service consumption potential continued to be released, and market sales growth momentum was good.
(This article was first published in Titanium Media APP, author: Li Jingying)
For more macro research dry goods, please pay attention to the official account of Titanium Media International Think Tank: