Recently, a number of home appliance enterprises announced the 2023 annual report, the performance of white electricity leading enterprises continued to grow steadily, the performance of small home appliance enterprises is commendable, driving the home appliance sector stock price rise, Hong Kong home appliance stocks also began to rise against the trend.

Home Appliance Industry Index performance (since January 2024-present)

 Midea Group, the current home appliance enterprise with the highest market value, achieved an operating revenue of 373.7 billion yuan in 2023, up 8.10% year on year, and achieved a net profit of 33.7 billion yuan, up 14.10% year on year. In addition, the company plans to pay dividends of 3 yuan per share, the dividend rate of 62%, corresponding to the stock price on March 29, the dividend rate of 4.67%.

 In 2023, Hisense home Appliances achieved an operating revenue of 85.6 billion yuan, up 15.5% year on year, and achieved a net profit of 2.837 billion yuan, up 97.73% year on year. The profit growth rate led the home appliance industry. At the same time, the company plans to distribute a cash dividend of 10.13 yuan per 10 shares, the dividend amount increased by 95.9% compared with last year.

 In 2023, Haier Zhijia achieved operating income of 261.428 billion yuan, up 7.3% year on year, and realized net profit of 16.597 billion yuan, up 12.8% year on year. The company will also introduce a three-year shareholder return plan, with a cash dividend ratio of no less than 50%.

From the above company’s generous dividend move is easy to see, home appliance enterprises not only really make money, but also on the future expectations are relatively optimistic —— overseas market on its performance growth of the good driving role has almost become a clear card.

 Both production and marketing thrive

 Overseas markets have become an important source of growth for home appliance enterprises.

 Home appliances have long been an important category of China’s export products. In 2023, the export volume of home appliances industry exceeded 100 billion US dollars (103.07 billion US dollars), ranking the second in the light industry, accounting for 11.5%.

 Home appliance exports have started even better this year. According to the data of the General Administration of Customs, in January and February 2024, the overall export volume, export volume (US dollar) and export volume of home appliances (RMB) increased by 38.6,20.8 and 24.3% respectively, and the volume all achieved rapid growth.

 By region, The performance of Chinese home appliance brands in South America is the most prominent, with most of the category of exports growing at a high speed, followed by Africa, and in the Asian market, the kitchen and small home appliances are relatively good performance.

 European markets, the traditional export hub, have also recovered. The US market was relatively cold. Mexico has now replaced China as the largest exporter of TV products in the United States, while Vietnam has replaced China as the largest exporter of vacuum cleaners to the United States.

 This is also reflected in the performance reports of major home appliance enterprises. The overseas revenue of Hisense home appliance in 2023 increased by 12.3% to 27.92 billion. 2 H1 and H2 were-0.6% and + 29.7% year-on-year respectively, effectively improving the profitability.

 In 2023, Haier Jiazhi's overseas revenue reached 136.412 billion yuan, up 7.6% year on year, accounting for 52.2% of the revenue. Among them, the business revenue of America, Australia, South Asia, Europe, Southeast Asia, Central and East Africa and Japan was + 4.1%, -11.8%, + 14.9%, + 23.9%, + 11.6%, -1.8% and + 2.6% respectively.

 Such achievements, and Chinese home appliance enterprises actively invest in overseas factories. Domestic brands not only passively set up factories in Mexico, Vietnam and other places to avoid trade friction and seek lower production costs, but also more actively invest in developing emerging markets such as Southeast Asia, South America and Africa.

 Southeast Asia has a huge population base, the influx of investment enthusiasm, trade, consumption, culture and other aspects are "adjacent" to China, the growth potential of the European and American markets is greater than the declining heat, and the legal risk is lower than India, which is undoubtedly a more realistic choice for Chinese home appliance enterprises to go overseas.

 Taking air conditioning as an example, in 2023, China's export of air conditioning products increased by 7.7% year on year, mainly from the Asian and Latin American markets. Among them, the Asian market accounted for 50.5% of China's air conditioning exports, with a year-on-year growth of 9.7%, while the Latin American market became the third largest export destination, with a year-on-year growth of 36.7%.

 Hisense Home Appliances established the ASEAN regional headquarters in the beginning of 2023, hoping to continue to expand the business of Hisense TV in the Asia-Pacific market while consolidating the European, American and Japanese markets. This move led to the revenue growth of Hisense Home Appliances in the ASEAN region by more than 20%, and the growth of its private brands increased by more than 70%.

Latin America and Africa are both "Belt and Road" radiation regions, also rich in growth potential, Haier, Midea and other home appliance enterprises to invest in Egypt, the value is to accelerate the pace of entry into the Middle East, Africa and even European markets through Egypt, and bring bright performance growth.

 For example, the recent export of washing machines in Russia, Italy, Spain, Uzbekistan, Kazakhstan and other countries; TV exports increased 24.4% in 2023, also from the European and Latin American markets.

The overseas industrial layout and cooperation mode of Chinese home appliance enterprises have already blossomed and borne fruit.

 Increase profits

 Chinese home appliance enterprises have evolved from selling products to selling brands.

 If you look at the lessons of Japanese home appliance brands, you can understand why Chinese home appliance enterprises must "go out".

 According to the President Online, Japan's home appliance manufacturers ranked first in the global consumer electronics market share in 2002, with five companies in the top 10. Now, however, Panasonic is the only one left in the top 10.

 Once popular around the world, with the death of Matsushita Konosuke and lonely, never launched like VHS tape video recorder as sweeping the world's best-selling goods. Panasonic Shanghai Plasma Display company from production to closure (2001-2011), also indicates that its market share will be acquired by the Chinese local competitors.

 At the same time, Toshiba's black electricity business was acquired by Hisense, white electricity business was acquired by Midea, and the enterprise was finally delisted; Sanyo Electric Southeast Asia white electricity business was acquired by Haier, Hefei Sanyo was acquired by Whirlpool and Galanz successively, and Sanyo domestic TV business was acquired by Changhong, and the enterprise finally disappeared.

 It can be said that Japanese home appliance brands have been swallowed up by Chinese home appliance enterprises, and they have lost their global market share and industrial chain position. If Chinese home appliance enterprises want to continue to win, they can not only rely on good quality and low price, but also go more thoroughly on the international route, and ensure that new home appliances continue to launch and occupy the first opportunity.

 The fierce competition in China's home appliance market and even the high internal quality can force domestic brands to quickly iterate their products and accumulate technical experience. This advantage is also difficult to be replaced by emerging industrial clusters such as Southeast Asia, but it also lays the hidden danger of "price for quantity" for domestic brands.

 Sweeping robot is a typical example. This industry category first appeared in the United States, when the leader in the market segment was iRobot in the United States. Now the mainstream consumer market for sweeping robots is still in Europe and the United States, and Chinese brands to survive in this field must be able to compete with local brands such as iRobot.

 Since 2022, influenced by the weak consumption and other factors, the sweeping robot industry, as a representative of high-end smart home appliances, had to temporarily put down the high-end strategy and start a "price war", hoping to effectively improve the market share, but the performance and stock price are under double pressure.

So, for new products of low permeability, higher profit margins of overseas markets is the domestic sweeping robot brands, power, since the second half of 2023 has been able to do new products in China, Europe, southeast Asia, South Korea, Japan, Australia, New Zealand, and will be listed in the United States.

performance (since listing)

 Stone Technology continues to establish a global distribution network. At present, it has set up overseas companies in the United States, Japan, Germany, South Korea and other places, and opened online brand stores in Amazon, WalMart and other online platforms in the United States. The company's products have reached the top three in 14 countries such as Germany, Australia and Japan.

 In 2023, the gross profit margin of Stone Technology in China increased by 4.16 pct to 49.26%, while the gross profit margin of overseas regions increased by 8.55 pct to 61.65% year on year. The competitiveness of its products in the high-end market can be seen, which also inspires other domestic brands trapped in the "price war".

Although stone technology is the first of China's leading brands of the whole base station products layout 2000 + price belt, its domestic business growth rate is also better than the overseas market, but the company's overall profit repair mainly depends on the overseas regional revenue growth and accelerated upgrading of product structure.

 Dividend constantly

 Home appliance giants can always eat the dividend of the development of The Times.

 Similar to sweeping robots, small home appliances are also confined to the domestic market will face a low ceiling problem, performance differentiation is more obvious. In 2023, the overall retail sales of small home appliances market represented by kitchen electricity was only 54.93 billion yuan, down 9.6% year on year. The online and offline retail volume and average price showed a trend of decline across the board.

 Jiuyang, which started with small kitchen appliances, achieved poor performance, achieving operating income of 9.613 billion yuan in 2023, down 5.54% year on year, and the net profit attributable to shareholders of the listed company was 389 million yuan, down 26.58% year on year.

 Xinbao Stock and Supor are mainly driven by export. After previous overseas order transfer and core category expansion, the former, the export scale of the company has increased from about 7 billion in 2019 to about 11 billion at present; the latter increased by 19.2% in 2023, effectively improving the profitability of the enterprise.

 Because the entry threshold is low and it is difficult to achieve the scale effect, expanding the category and strengthening the channels to meet the specific needs of different markets has also become the key to whether the small home appliance enterprises can counter the current.

 Different from the subdivided track players who are easily affected by the environment and struggle on the profit and loss line, the big leaders in the home appliance enterprises have been sitting firmly, and can always eat the dividend of the development of The Times.

 In the early stage of reform and opening up, home appliances began to be popularized in China and the demand exceeded the supply. Haier, Gree, Changhong and other national brands were established, from only import, assembly, introduction and development to independent research and development and large-scale production, and gradually laid the model of China's home appliance industry chain, which is a wave of dividends.

 In foreign brands and domestic brands, the country during 2009-2012 has introduced a "home appliances to the countryside", "home appliance for new" and "energy saving huimin project" three policies to expand domestic demand, comprehensively promote domestic demand growth and industrial structure adjustment, good support the domestic home appliance brand strength, this is a wave of dividends.

 By 2010, the competition pattern of China's home appliance market was basically laid, foreign brands failed one after another, and the top brands with Midea, Gree and Haier as the main body occupied most of the domestic market share. On this basis, domestic home appliance brands have explored the high-end brand path of consumption upgrade. —— The most typical representative is Haier's Casati, and Gree air conditioning with relatively high price, and then eat a wave of dividends.

 Today, China contributes nearly 90 percent of the total production of the world home appliance market, far more than other regions.

 Recently, with the State Council issued the "Action Plan to promote large-scale equipment renewal and consumer goods for new", a new round of consumption stimulus policy is about to be implemented, and many home appliance enterprises will directly benefit. It is reported that Suning Tesco more than 10,000 retail cloud stores together with Midea, Haier, Hisense, BSH, Samsung and other more than 30 home appliance manufacturers to carry out the old home appliance for new activities, driving sales growth by more than three times in March.

With the life of home appliances for 10 years as the cycle calculation, air conditioning, refrigerators, washing machines, color TV replacement demand space, the gap in at least tens of millions of units, this is also the most dominant field of leading enterprises such as Midea, Gree, Haier, no accident, the performance of these companies will continue to grow steadily.

Performance of Midea Group (since listing)

 What's more, these leading home appliance enterprises have already successfully gone to sea. In 2023, Midea's overseas revenue will exceed 150 billion yuan, and Haier's overseas revenue will reach 135.7 billion yuan. Internationalization is no longer a problem for Chinese home appliance enterprises.

With Chinese home appliance brand in the global competitiveness, the future Chinese home appliance products will be in the international market to get more market share, voice and initiative, another dividend in the process of the immediate —— Africa, Latin America and Asia consumers waving money, the deepening of international home appliance consumption and upgrade tide.