According to the Zhitong Finance APP, Guolian Minsheng Securities released a research report stating that there is a significant differentiation within the light industry sector in the first half of 2025. The trends in new consumption sectors such as the millet economy and personal care are clear, with impressive stock performance, while traditional industries like home furnishings and paper-making are relatively under pressure. Looking ahead to the second half of the year, there is a short-term risk of a pullback in some overheated sectors, and attention should be paid to solid fundamentals of leading companies in niche segments, while also valuing the defensive value of traditional consumption leaders' valuation recovery. The home furnishings sector is optimistic about the upgrade of old for new driving concentration; the export chain is expected to see short-term performance recovery and long-term differentiated layout; in paper-making, attention is recommended for SUN PAPER; in packaging, focus on leading metal packaging companies and YUTO TECH; for new consumption, focus on high-prosperity sectors while also paying attention to excellent traditional companies seeking transformation and exploring new opportunities.
<h2>The main views of Guolian Minsheng Securities are as follows:</h2>
Light Industry: Performance stronger than the market, valuation at the 73rd percentile over the past decade
As of May 30, 2025, the light manufacturing sector has decreased by 0.89% year-to-date, ranking 14th among 31 Shenwan first-level industries. The overall performance of the light manufacturing Shenwan index is stronger than that of the CSI 300 index, with a relative return of +3.08%. In terms of sub-sectors, the millet economy, personal care, and other new consumption and packaging printing sectors have shown considerable performance in the first half of the year. The overall PE (TTM) valuation of the light industry sector is 46.90X, at the 73.19th percentile level over the past 10 years.
New Consumption: Rise of self-indulgent consumption, quality domestic products lead the way
Against the backdrop of overall consumption pressure, some sub-sectors still maintain high prosperity. It is recommended to grasp new consumption investment opportunities from the following dimensions: 1) Focus on high-growth sectors: Pay attention to new consumption areas driven by emotional value, such as national trend culture, self-indulgent consumption, and technology-enabled scenarios (smart wearables, AI+ applications), which benefit from the iterative demand of Generation Z and supply innovation, with penetration rates expected to continue to rise; 2) Excellent traditional companies actively seek change: Some traditional manufacturers are adapting to high prosperity trends, reusing channel and supply chain advantages, and are expected to achieve rapid growth in new businesses.
Home Furnishings: Base gradually declining, Q2-Q3 year-on-year pressure easing
In 2025, tariff disturbances affected home furnishing stock prices, with PE maintaining dynamic balance overall. New housing data remains low in prosperity, while the second-hand housing market performs well, and under national subsidies, the retail sales growth of home furnishings has increased to over 20%. The pace of opening new home furnishing stores has slowed, with companies capturing fragmented customer flow through a 1+N+X layout to deeply reach existing customer demand. Sofas may be affected by tariffs, but the layout in Vietnam and Mexico limits the impact. The suspension of national subsidies in June and the expected limits on second-phase subsidies may short-term affect home furnishing orders, but regional restrictions will further enhance the competitiveness of leading companies. In terms of performance, the base for home furnishings is gradually declining, and it is expected that year-on-year pressure will ease in Q2-Q3 of 2025, while 3C certification for smart toilets may alleviate the intense competitive landscape.
Export Chain: Limited tariff impact, overseas capacity accelerating
In the first half of 2025, light industry companies experienced two rounds of export rush: preemptive orders before the implementation of reciprocal tariffs on April 2 and capacity transfer after tariff exemptions in Southeast Asia, with orders expected to be catalyzed in the short term. Companies are accelerating exports to the U.S., with shipping costs from the West and East coasts increasing compared to the previous quarter, and tariffs are expected to return to normal levels after stabilization. With the acceleration of overseas capacity investment, factory ramp-up has caused a slight decline in corporate gross margins in the short term
The bank expects that future tariffs may have some impact on exports, but the release of capacity in Vietnam and the transfer of cost increases may limit the impact. It is recommended to pay attention to export companies in Vietnam that can cover exposure to the U.S. market, as well as companies with differentiated layouts in Southeast Asia, Latin America, and Europe.
Papermaking: Focus on leading companies with significant cost advantages
Overall, the industry is still in a capacity expansion cycle. In 2024, the cumulative year-on-year growth of fixed asset investment in China's papermaking and paper products industry reached 18.5%, with considerable capacity being added across various subcategories. 1) Pulp and paper: Pulp prices have peaked and are retreating, indicating a potential cost turning point. The supply and demand for cultural paper are relatively stable, with Chenming's resumption of work being a disruptive factor. 2) Corrugated cardboard: Domestic new capacity and the pressure from imported paper supply have eased, and there are expectations for a boost in downstream demand.
Packaging: Demand is relatively stable, focus on pattern optimization
In terms of metal packaging, the domestic market for two-piece cans is currently at low levels of CAPEX and profitability. As the effects of industry consolidation become apparent, gross margins are expected to recover to reasonable levels; leading companies in the industry are accelerating their overseas layouts and are likely to benefit from the high prosperity of emerging markets. In paper packaging, YUTO TECH. has established over 40 production bases and 4 major service centers in 10 countries and 40 cities worldwide, and its global layout is expected to hedge against tariff friction risks.
Risk Warning: Risks of consumer spending not meeting expectations, risks of significant increases in raw material prices, and increased uncertainty regarding tariffs

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Guolian Minsheng Securities released a research report indicating that in the first half of 2025, the light industry sector will show significant differentiation, with clear new consumption trends and traditional industries facing pressure. It is recommended that investors pay attention to high-growth sectors and the transformation opportunities of excellent traditional companies. The light manufacturing sector is performing better than the market, with valuations at a near ten-year high. New consumption areas such as national trend culture and technology-enabled scenarios are benefiting from the demand of Generation Z, with penetration rates expected to increase. The home furnishing industry is expected to achieve growth under policy incentives

Guolian Minsheng Securities: New consumption trends are clear, traditional industries prefer leading companies