With the market share continuing to be concentrated in the head companies, Gree, Midea, Haier and other white goods giants ranked first in profitability.
The First Financial Reporter learned that the net asset yield of the Big Three of white goods is also at a relatively high level in China's manufacturing industry, with more than 20% for two consecutive years, and that they hold the right to speak in the industry chain is the main reason.
Revenue, profit hit new highs
In 2017, Gree Electric Appliances (000651.SZ), Midea Group (000333.SZ) and Qingdao Haier (600690.SH) both set the best revenue and profit records in their history.
Among them, Gree Electric Appliances realized total operating income of 150.02 billion yuan in 2017, an increase of 36.24% year-on-year; net profit attributable to shareholders of the parent company was 22.4 billion yuan, an increase of 44.87% year-on-year; and the weighted average return on net assets was as high as 37.44%.
The Group's total operating revenue in 2017 was 24.192 billion yuan, up 51.35% year-on-year; net profit attributable to shareholders of the parent company was 17.28 billion yuan, an increase of 17.7% year-on-year; and the weighted average return on net assets was 25.88%.
Qingdao Haier’s operating revenue for 2017 was RMB 159.5 billion, up 33.68% year-on-year; net profit attributable to shareholders of the parent company was RMB 6.93 billion, up 37.4% year-on-year; the weighted average return on net assets was 23.59%.
A market senior analyst told the CBN reporter that usually speaking, 15% is an important measure of the company's quality. If the return on net assets reaches or exceeds 15%, then this is a good company. The enterprise's ROE is at a high level in China's manufacturing industry.
The profit protection of the three companies is a stable market position. According to data provided by Industry Online to the First Financial Reporter, in 2017 Gree, Midea, Haier’s total market share of home air conditioner industry in China (including exports) was as high as 65%, which was a year-on-year increase of 2.4. Percentage point. Facing the rising market situation of raw material prices, the leading industry chain has a strong industrial chain status that not only can obtain lower costs, but also has obvious advantages in the price side of products, and basically grasps the pricing power of the market; in the refrigerator industry, 2017 Haier, Midea, Hisense Kelon's total market share in China's refrigerator industry (including exports) reached 46%, an increase of 1 percentage point year-on-year. In the washing machine industry, 2017 Haier, Little Swan (belonging to the United States), Whirlpool under 10 kg in China The total market share of the washing machine industry (including exports) reached 58%.
If you simply look at the Chinese domestic market, Gree, Midea's home air-conditioning market, Haier, Midea's refrigerator and washing machine market, its pattern of oligopolistic competition is even more pronounced.
According to data provided by the AVC Cloud Network (AVC) to the First Financial Reporter, monthly monitoring of retail data from its offline line shows that Gree and Midea's total share of the domestic air-conditioning market in the first quarter of 2018 further increased to 67.3%; Haier, Midea In the first quarter of 2018, the total share of the domestic refrigerator market was further increased to 45.8%; the total share of the domestic washing machine market in the first quarter of 2018 in Haier and Midea reached 52.5%.
At present, Gree is the largest domestic air conditioner supplier in the world; Haier is the world’s largest supplier of refrigerators, washing machines, and water heaters; Midea’s domestic air conditioners in the domestic market are second only to Gree and Haier, and they are Rice cookers, electric pressure cookers, induction cookers, electric fans and other small appliances industry are in the leading position.
Hand holding core components, channels
The White Power Big Three not only has a stable market position, but also has the upper right channel and the downstream channel network. Gree and Midea have mastered the capacity of air conditioner upstream compressors. Midea's Meizhi is the world's largest manufacturer of air conditioning compressors. Gree's Lingda Compressor's capacity in 2018 also expanded to 55 million units, which can almost meet their own needs.
Looking from the downstream channels, Gree, Midea, and Haier all have huge retail networks. Gree has 27 regional sales companies and more than 30,000 specialty stores in China. Haier has built more than 8,000 county-level specialty stores across the country, 30000 Yujia Township Network. At the same time, they actively explored online channels and worked closely with Gome, Suning and other major chains as well as Jingdong, Tmall and other online shopping platforms.
As a result, the three major white power giants have mastered the pricing power of products to a certain extent. At the same time, they continue to pass technological innovations and expand the proportion of high-end products, so they have obtained higher gross profit margins. For example, Haier's 2017 air conditioners, refrigerators, washing machines and kitchens. Wei Electric's gross profit margin exceeded 31%; Gree's air-conditioning gross margin for 2017 was as high as 37%; the US's 2017 HVAC, consumer electronics gross margin was over 27%.
However, the growth rate of the white power industry is slowing down. Smart manufacturing has become the 'second track' jointly targeted by the three white companies.
Midea is already the world's largest robotic company, Germany's KUKA, with its controlling share of 94.55%. Last year, its robotic and automation systems revenue reached 27 billion yuan. In March of this year, Midea announced that it will inject capital into the business of KUKA. Three joint ventures to expand the business of industrial robots, medical robots and warehouse automation. In the same month, the U.S. KUKA Smart Manufacturing Industry Base started construction in Shunde, Guangdong.
Gree took the path of independent innovation. In 2017, Gree’s revenue from smart equipment business including robotics and CNC machine tools reached 2.13 billion yuan. In the future, Gree hopes to master R&D and manufacturing of core components and gradually build smart equipment business into new profits. growth point.
Haier vigorously developed the COSMOPlat industrial Internet platform, using Haier's nine major Internet factories as a model, achieving cross-industry, cross-sector expansion, replicating to 12 industries, and 11 regions. The COSMOPlat platform achieved an initial revenue of 566 million yuan in the first quarter of this year; it also acquired Fisher & Paykel Production Equipment Co., Ltd. establishes intelligent equipment business platform.
China’s demographic dividend is gradually disappearing. Labor shortages, rising costs, automation of production, industrial Internet are the upgrade directions of Chinese manufacturing, and bring huge markets and opportunities. The three major white power giants actively develop robots, smart equipment and industrial Internet businesses. On the one hand, it promotes the transformation and upgrading of its own manufacturing industry; on the other hand, it opens up new space for growth.