According to the Zhitong Finance APP, Guojin Securities released a research report stating that the current expansion cycle of the polyester filament industry is nearing its end, and the industry's concentration is showing a continuous upward trend, strengthening the voice of leading enterprises. On the other hand, the industry's inventory is at a historical low. Against the backdrop of stable growth in domestic and foreign demand for textiles and apparel, the supply and demand for domestic polyester filament may continue to be tight in 2025-2026, which is expected to drive polyester filament prices into an upward cycle. It is recommended to pay attention to relevant enterprises with large filament production capacity and supporting upstream raw materials such as PTA.
<h2>Guojin Securities' main viewpoints are as follows:</h2>
Supply Side:
Market share of leading enterprises is increasing, and the competitive landscape is continuously optimizing. In the context of the last round of concentrated capacity release, leading enterprises added a significant amount of new capacity, resulting in a continuous increase in industry concentration. According to data from Zhuochuang Information and company announcements, from 2017 to 2023, TKGF's polyester filament capacity increased from 4.6 million tons to 13.5 million tons, with its capacity share rising from 13% to 27%; XfmGroup's polyester filament capacity increased from 2.73 million tons to 7.4 million tons, with its capacity share rising from 8% to 15%. The combined capacity share of the two exceeds 40%. Meanwhile, according to Zhuochuang Information data, the CR4 of the domestic polyester filament industry in 2023 is approximately 58%.
The industry's expansion is nearing its end, with limited new capacity concentrated in leading enterprises. According to Zhuochuang Information data, the domestic polyester filament capacity planned for construction is approximately 2.25 million tons, of which 1.85 million tons are planned to be put into production in 2025. This is significantly down from the peak period of industry capacity release, and from the enterprise perspective, new capacity is mainly concentrated in XfmGroup and TKGF. If the planned capacity is put into production as scheduled, the industry's concentration is expected to further increase.
Demand Side:
In terms of domestic demand, affected by the high base and high growth in 2023, the growth of domestic retail in textiles and apparel is under pressure, remaining basically stable for the whole year. According to data from the National Bureau of Statistics, the cumulative retail value of domestic clothing, shoes, hats, and textile products from January to December 2024 is approximately 1.47 trillion yuan, a year-on-year increase of 0.3%. From the investment side, as textile enterprises steadily expand their investments in high-end, intelligent, and green transformation and upgrading, according to data from the National Bureau of Statistics, the actual completed fixed asset investment in the domestic textile, apparel, shoes, and hats manufacturing industry from January to December 2024 is expected to grow by 18.0% year-on-year. From the production side, the income and profits of domestic textile and apparel production enterprises are showing a steady increase. According to data from the National Bureau of Statistics, from January to November 2024, the operating income of large-scale industrial enterprises in the domestic textile, apparel, and accessories industry is approximately 1.14 trillion yuan, a year-on-year increase of 2.6%; total profit reached 54.95 billion yuan, a year-on-year increase of 3.9%; and the cumulative year-on-year growth of industrial added value in the domestic textile, apparel, and accessories industry from January to December 2024 is expected to be 0.8%.
In terms of exports, overseas clothing and fabric wholesalers' inventories have decreased to historically normal levels. From the consumption side, the retail sales of clothing and accessories stores in the United States are generally stable with an increase, coupled with the inventory decline factor, the inventory-to-sales ratio of U.S. clothing and fabric wholesalers is showing a downward trend. This may lead to a new round of replenishment cycle in the future, which will have a positive effect on China's textile exports and indirectly boost the demand for upstream polyester filament
In addition, according to data from Zhuochuang Information, China's polyester filament export volume is expected to grow from 1.593 million tons in 2014 to 3.933 million tons in 2024, with an average annual compound growth rate of approximately 9.5%. According to Zhuochuang Information data and related information, China's polyester filament export volume is expected to decline by 100,000 tons year-on-year in 2024, a decrease of about 2.5%. One of the main reasons for this is the significant decline in exports to India due to the Indian BIS certification. However, due to the rapid growth in demand from Southeast Asian countries such as Vietnam, the filament export volume is expected to recover in the future.
Based on calculations, it is estimated that the domestic polyester filament supply-demand gap for 2025-2026 will be 880,000 tons and 1.89 million tons, respectively, accounting for 2% and 4% of the total domestic supply for that year. The domestic polyester filament supply-demand may continue to be tight, which is expected to drive up polyester filament prices.
Investment Suggestions: It is recommended to pay attention to TKGF (601233.SH), XfmGroup (603225.SH), and other related companies with significant filament production capacity and supporting upstream PTA and other raw materials.
Risk Warning: Risks of downstream demand being lower than expected; risks of industry expansion exceeding expectations; risks of raw material price fluctuations; risks of intensified industry competition

601233

600346

603073

603225

Guojin Securities released a research report indicating that the supply and demand for domestic polyester filament will continue to be tight from 2025 to 2026, with prices expected to enter an upward cycle. The industry's expansion cycle is nearing its end, leading enterprises are increasing their market share, and inventory is at a historical low. It is recommended to pay attention to relevant companies with significant filament production capacity and upstream PTA raw materials

Zhitong

TKGF

HLSH

Cady

XfmGroup

ANNIL

Honghua Digital Technology

KUTESMART

TOPSPORTS

TAITAN

Elite Color

Ruyi Group

Weixing

SOFTCARE

XIN HEE

Nanshan Fashion

ARGUS

Youngor

Hongdou Industrial

SEMIR

SINOLINK SECURITIES

Dynanonic

WCJL

CHOW TAI FOOK

Yuma Technology

Guotai Junan Securities: The supply and demand for polyester filament may continue to be tight, and prices are expected to enter an upward cycle