The Zhitong Finance App learned that CITIC Construction Investment released a research report saying that the home appliance and smart hardware sector is shifting from “domestic stock competition” to “global expansion+new technology category growth,” and the main investment line takes into account steady value and emerging growth. Among traditional home appliances, white electricity has strengthened dividend-like attributes with a stable pattern, improved operating efficiency, overseas expansion and high dividends; black electricity relies on structural upgrades such as large size, mini LEDs, etc., and an increase in global share, and the profit center is expected to move upward; the peak of capital expenditure and depreciation in the panel industry has gradually passed and entered a period of profit and cash flow release. The growth direction focuses on clean appliances, smart imaging, consumer-grade 3D printing and AI NAS. Low penetration rates, technology iteration, and expansion of overseas demand are expected to drive industry growth, and the share of leaders with R&D, supply chain and global channel advantages is expected to increase.
CITIC Construction Investment's main views are as follows:
The home appliance sector may seem simple, but in reality there are various research methods: white electricity is currently more stable consumer goods, and the market focuses on dividend rates; kitchen appliances are a typical post-real estate cycle industry, which is closely related to real estate policies and real estate demand; new growing sub-industries need to pay more attention to space, technological evolution, and pattern changes at the research level
Areas of interest: From domestic to foreign. Previously, research on home appliances established a deep understanding framework and tracking system for domestic products and channels, but the future growth of the industry mainly comes from overseas, but overseas markets are far from domestic investors, and the tracking system is still not perfect, but it is indeed a core research focus in the future.
White Power: Steady growth, high dividends and undervaluation have become a model value stock. The country is gradually approaching the ceiling, but there is still room for improvement in the structure. The competitive pattern of the industry is stable, and the position of the three major white batteries in the domestic market is unshakable. In recent years, the DTC transformation has been promoted to continuously improve efficiency; the future growth of the white power industry is mainly focused on the continuous expansion of overseas markets, becoming the core source of future growth.
Black Electronics: A mature home electronics sector driven by both high-end structural upgrades and global expansion. Domestic market stock characteristics are remarkable, and real estate correlation is weak. Growth is mainly driven by structural upgrades of high-end models such as large size, miniLED, and AI smart interaction to drive average price increases; overseas emerging markets are growing broadly and are the core growth engine of the industry in the medium to long term. Industry leaders Hisense Video and TCL Electronics rely on self-development of complete machines, global localization production, multi-regional channels, DTC brand operation, and sports event marketing to build barriers, and continue to seize the share of overseas local brands. Competition in the industry has moved away from simple low prices to a comprehensive competition of intelligent products, localized overseas operation, and whole-house connectivity ecological capabilities. The global share of domestic double leaders continues to be concentrated, and the profit center is steadily rising along with high-end technology and overseas travel.
3D printing: An emerging manufacturing sub-industry with both technological growth and continuous payment attributes. As multi-color, speed and material systems continue to be upgraded, application scenarios are expanding towards consumer-grade manufacturing. Leading companies accumulate users through hardware sales and rely on consumables, software, and content ecosystems to form continuous revenue, and the business model is highly scalable.
Clean appliances: A growing home electronics industry characterized by technology-driven, increased penetration, and rapid changes in pattern. Technologies such as LDS, AI recognition, robotic arms, and base station self-cleaning are continuously upgraded to continuously improve product experience and expand usage scenarios. Currently, there is still a lot of room for improvement in domestic and foreign penetration. Leading brands rely on R&D, supply chains, channels and brand advantages to expand their share. Industry competition is shifting from price orientation to competition in technology and global capabilities, and the pattern is expected to be further concentrated.
Intelligent imaging: A growing smart hardware circuit driven by imaging and flight control technology, expanding overseas outdoor demand, and accelerating the concentration of the industry landscape. Technologies such as anti-shake algorithms, panoramic imaging, low-altitude flight control, and AI intelligent editing continue to be iterated to expand diverse usage scenarios for sports records, outdoor aerial photography, and vlog creation. There is still room for significant improvement in the penetration rate of outdoor consumption at home and abroad. Leading manufacturers continue to seize market share by relying on self-developed video research, complete supply chains, and global channel advantages. Industry competition shifts from internal hardware parameters to comprehensive competition between self-developed technology, content ecology and overseas localization operations, and leading shares continue to be concentrated; machine hardware is traffic entry, and accessories and editing members form long-term value-added revenue, and overseas markets are the core source of growth for the sector.
NAS: AI-enabled, high-growth smart hardware circuit from storage hardware to home digital hub. Home NAS has comprehensive advantages, but there are core barriers such as products, markets, and perceptions, leading to a low penetration rate. AI has completely broken the bottleneck of traditional NAS development, transforming the NAS from a niche geek device to a digital hub for the public, and achieving an exponential expansion of the user base. Global AI NAS sales will grow from 60,000 units in 2024 to 6.69 million units in 2035. The CAGR is 54%, and the penetration rate will increase to more than 60%. In the future, the AI NAS competitive landscape will enter a period of accelerated restructuring.
Risk Alerts
1. The macroeconomic growth rate fell short of expectations. Household appliances are durable consumer goods and are closely related to residents' income expectations. If macroeconomic growth slows down, it may have a big impact on industry sales;
2. Prices of raw materials fluctuate greatly: the raw material costs of home appliance companies account for a large share of operating costs. If bulk prices rise again, the profitability of the sector will weaken;
3. Overseas market risk: Uncertainty in the overseas environment has intensified in recent years. Leading home appliances account for a relatively high share of export sales. If external demand declines, performance will be impacted accordingly;
4. Increased market competition: In a weak market environment, industry competition is more intense. Some companies risk losing share and low price competition dragging down profits.