Wanlian Securities: The performance of the light industry manufacturing sector in 2025 is expected to be flat, with the home furnishings sub-sector's profit forecast relatively high.

Wanlian Securities released a research report stating that the recent downstream demand in the paper industry has been relatively stable, pulp prices have eased, and several paper companies have issued "price increase notices" in recent months. Industry profit margins are expected to improve, and it is recommended to focus on leading paper companies with production capacity and cost advantages. In terms of home furnishings and appliances, the optimization of real estate policies, the implementation of the trade-in subsidy for consumer goods, and the recovery of domestic demand for home furnishings and appliances are being driven. At the same time, the export chain is benefiting from the recovery of overseas demand, and it is recommended to focus on undervalued, high dividend, and leading home appliance and home furnishing companies with scale advantages. The main points of Wanlian Securities are as follows: Light industry performance forecast is flat, with a forecasted profit rate of 44% As of February 13, 2026, there were a total of 168 A-share companies in the light manufacturing industry, with 84 companies issuing performance forecasts, resulting in an industry disclosure rate of 50%, ranking 4th among the eight consumer industries, with a forecasted profit rate of 44%, ranking 7th among the eight consumer industries. Specifically looking at the type of performance forecasts, 19% of light industry companies showed a decrease in performance in 2025 due to factors such as a weak macro environment and weak consumer demand. Additionally, 38% of companies have continued to incur losses for two consecutive years, with an increase compared to 2024. Furthermore, the proportion of companies showing growth/slight growth has decreased compared to 2024. Sub-sector performance differentiation, home furnishings sector has a higher forecasted profit rate In terms of disclosure rates: only the home furnishings sector has a disclosure rate of over 50% among the four sub-sectors, at 53%; the paper sector has a disclosure rate of 50%, packaging and printing has a disclosure rate of 49%, and the entertainment products sector has the lowest disclosure rate at 41%. In terms of forecasted profit rates: there is significant differentiation in performance among the sub-sectors. The forecasted profit rate for companies that have disclosed performance forecasts in the home furnishings sector is 53%, ranking 1st among the second-tier sub-sectors of light manufacturing; the forecasted profit rates for the paper/packaging and printing/entertainment products sectors are all below 50%, at 42%/35%/33% respectively. Looking at the proportion of forecasted types in each sub-sector, in 2025, performance forecasts for the paper sector have shown differentiation, with one each of growth/slight growth/decrease/turnaround/first loss/continuing loss companies. Yibin Paper Industry has a significant increase in net profit forecast for 2025, turning losses into profits. In the entertainment products sector, 66% of companies have incurred losses, with 22% for first loss/44% for continuing loss. The proportion of continued losses has significantly increased compared to 2024, while the proportion of growth forecasts has decreased. In the home furnishings sector, the proportion of companies with growth/slight growth forecasts is 10%/0%, both decreasing compared to 2024. In the packaging and printing sector, the proportion of companies with growth/slight growth forecasts is 13%/4%, decreasing compared to 2024, while the proportion of companies with continuing losses has increased. Risk factors: risks include the macroeconomic recovery falling short of expectations, intensified industry competition, channel expansion falling short of expectations, and significant fluctuations in raw material prices.