The first stock of Suma in the recession

Sima clothing has encountered problems and is obviously not small. Because it is already difficult to predict its future.

"I have stayed here for two or three years. I have never experienced such a dismal situation as in the first half of this year. Domestic casual men's wear does not do well. In the future, if we open a few European and American leisure brands in the next six hundred years, we really don't know how to spend our days. "One day at the end of July 2013, at the Sima store in Pudong, when a staff member talked to a reporter for the Money Weekly, his tone was full of unforgettable loss.

In the better Xuhui Senma store in the lot, the situation does not seem to be a good place to go. There are only two or three sparse people, and they see more and buy less.

"It's worse than the same period last year! No more than 60% of the inventory is under pressure for more than half a year. Now we are counting on discounts." A Xuhui store clerk reluctantly told the Money Weekly reporter.

This is just a microcosm of the current decline in the performance of Semima Garments (002563.SZ).

In fact, since its listing in 2011, Semir's performance has continued to decline, and the company's stock price has plummeted.

In the bottleneck of growth, Semir started a series of acquisitions to implement his multi-brand strategy. However, the acquisition of Sino-Muchashan for 2 billion yuan has caused considerable controversy. “Summa is now at a turning point in the strategic deployment period. There are two aspects in this turning point. It may be good or it may be bad. It depends on its ability to integrate the acquisition of this business is not strong, new business Can you make a good contribution to the main business?" Ma Gang, an independent commentator in the shoe and apparel industry commented.

Summa is mainly engaged in apparel design and development, outsourcing production, apparel marketing and distribution. It owns two brands of Summa casual wear and Balabala children wear.

According to Euromonitor's market research data, with the terminal sales revenue for 2008, Semir brand owned by Semir has become the second largest casual apparel brand in China, and Balabala brand is China's largest child apparel brand.

Summa apparel went on the market in March 2011. At the time, the starting price was as high as RMB 67 per share, corresponding to a P/E ratio of 44.97 times. In accordance with the total capital of 670 million shares, the market value was as high as 44.89 billion yuan, surpassing the market value of 304.82 billion at that time, and the market value of Youngor (250177 million shares), becoming the first in the apparel industry.

However, after the listing, Senma's performance growth rate fell sharply compared to before. In the three years prior to the listing, from 2008 to 2010, the company's total operating revenue was 3.323 billion yuan, 4.25 billion yuan, and 6.287 billion yuan, respectively, an increase of 82.34%, 27.92%, and 47.92% year-on-year; total revenue for the year of listing and 2012 was 7.761 billion yuan and 7.063 billion yuan, an increase of 23.44% year-on-year in 2011, and a decrease of 8.98% in 2012.

From 2008 to 2010, the net profit attributable to owners of the parent company of Senma Garment was 443 million yuan, 687 million yuan and 1 billion yuan, respectively, an increase of 195.52%, 54.90%, and 45.69% year-on-year; Senma's 2011 and 2012 The net profit was 1.223 billion yuan and 761 million yuan. It only increased by 22.26% in 2011 compared with the same period of last year, and decreased by 37.81% in 2012.

The number of Senma stores in 2009 and 2010 were 5,159 and 6,683 respectively, an increase of 1,099 and 1,524 respectively over the previous year. In the two years of 2011 and 2012, the number of Senma stores increased by 1,045.

On the other hand, despite the significant increase in the total assets of Semir, its operating efficiency has dropped significantly. In 2008, Semima's total assets were only 1.073 billion yuan. By 2012, it had expanded to 9.271 billion yuan, an increase of 7.64 times in four years. The total assets of Meibang Apparel (002269, stocks) at the end of 2008 was 4.577 billion yuan, and it was 7.006 billion yuan at the end of 2012, an increase of only 53.07% in four years.

In terms of total asset turnover, Summa, who was far ahead, was left behind by Smith Barney. From 2008 to 2012, Semir's total asset turnover rate dropped sharply from 4.11 to 0.77 times, while Micron's fell slightly from 1.39 to 1.20 times during the same period.

Why is Sunma's decline in performance after the listing? Senma's executive director Cheng Hongwei rejected the interview with the Money Weekly reporter on the grounds of "sensitive period".

A textile and apparel industry analyst in Shanghai told the reporter: “Summer’s performance decline is mainly due to the impact of foreign brands on the apparel industry and the downward trend in the industry. The second is the decline in demand for end-user consumption. With this mode of development, franchisees are more sensitive to the market itself, and the defect of the franchise model is highlighted in the context of poor market conditions."

"Senma's current development has encountered three major bottlenecks: category bottlenecks, market bottlenecks and management bottlenecks." Ma Gang, an independent commentator in the shoe and clothing industry, said.

Ma Gang said that Semir is a casual wear and children's clothing brand company, and its market position in these categories is doing a better job, but conversely, other categories are not enough, it needs to break through the category bottlenecks and make up for the bottleneck of categories. Short board. Senma's second short board is the market bottleneck. "It has been doing so for many years in the Chinese market. It is very difficult for the number of stores and customer groups to have a rapid growth. It is difficult to have more increments because of the restriction of the category itself."

The third short board is the management bottleneck. "From Senma's growth history we know that Senma's success is through marketing, and then attract investment, invite one or a few stars, or sponsor the game to let the brand everyone know, and then the brand's popularity and merchandise together Sold to an agent, and then the agent opened the store to all parts of the country, and the brand's first phase of development is this way."

"Obviously, this gameplay was still very advanced ten years ago, but now it seems that this is a very terrible gameplay. It is difficult to grow through the existing model. What should we do? Or we must manage it. Breakthroughs, management innovations In fact, many brands are mentioning this thing, a breakthrough from wholesale to retail,” said Ma Gang.

According to Yang Dazhao, president of UTA Fashion Management Group, the basic characteristics of Chinese apparel companies are that the growth cycle is too short. The second is that their success is based on the needs of the market at that time. There were opportunities for the market at the time that were greater than capacity, and many companies grew up in this environment in the early years. Therefore, in the face of fierce market competition, their actual competitiveness is relatively weak, such as research and development capabilities, operations, logistics, supply chain, information feedback, and then to the retail end, as well as brand enhancement and control capabilities. The overall strength is relatively weak.

Yang Dayuan believes that the growth margin of the Semir brand itself is not big enough. "No matter how much we invested in, how much the number of stores opened, and how much the market recovers, I think the era of rapid growth has passed. The slow growth of this brand is inevitable. It is very difficult for you to see how bright it is from the above."

However, he believes that Senma's children's wear brand, Balla Bara, has a lot of room for growth in the future.

On June 19, 2013, Semir apparel announced that it plans to purchase 71% of Zhongzheng Musan from Zhejiang Zhongzhe Holding Group Co., Ltd., Yang Herong, etc., with a total of 29.8 billion yuan to 2.26 billion yuan, and the remaining 29% will be owned by Zhongmumu. Still holding the management team. After the completion of this transaction, Zhongzhe Mushan will become a holding subsidiary of Semima Clothing.

Zhongzhe Mushang is a self-owned clothing brand company mainly located in mid-to-high-end casual men's wear. It owns such brands as GXG, gxg.jeans and gxg.kids. Since its establishment in 2007, the company has grown rapidly and is a dark horse in the industry. In just over six years, it has opened more than 1,200 retail outlets in major department stores and shopping malls nationwide. GXG ranks the top three in the sales of men's brands of the same category in major chain department stores such as Wanda, Intime, Ocean, and New World, and ranks among the top men's e-commerce sales on the Taobao platform.

The Senma Board of Directors believes that Zhongzhemushan effectively fills the company's mid-to-high end casual apparel business in terms of products, channels, customer groups, etc., and provides resources for the company to develop other mid-to-high-end brand businesses such as channels, talents, and supply chains. The transaction will effectively promote the implementation of the company's multi-brand strategy.

However, the market refused to believe Senma’s vision. Senma's share price dropped sharply after the resumption of trading. As of July 26, 2013, Semima's closing price was 20.62 yuan, which was a drop of 16.42% from the closing price of 24.67 yuan before the suspension on May 29th.

"The stock price has fallen more and more, mainly because the market thinks this price is too expensive, and it is also worried that the company has reached the top after the acquisition." The aforementioned Shanghai apparel industry analyst said.