Under the influence of a series of policies aimed at expanding domestic demand and promoting consumption, the potential for consumer demand for goods is being rapidly unleashed. Taking the recent National Day holiday as an example, the willingness to travel remained high, with a high volume and prices returning to stability. According to calculations by the Data Center of the Ministry of Culture and Tourism, during the 7-day National Day holiday, the number of domestic trips nationwide increased by 5.9% year-on-year at a comparable rate, and by 10.2% compared to the same period in 2019. The total expenditure of domestic tourists increased by 6.3% year-on-year at a comparable rate, and by 7.9% compared to the same period in 2019.

Several leading analysts from securities firms believe that policy efforts combined with the festive atmosphere have ignited consumer enthusiasm, and the demand for consumption during holidays continues to be released. According to the data from the State Taxation Administration's value-added tax invoices, the average daily sales revenue of industries related to consumption during the National Day holiday increased by 25.1% year-on-year, showing strong vitality in the consumer market. The consumption trend of basic living goods is good. Specifically, the revenue from grain, oil, and food increased by 16.4%, with the revenue from meat, poultry, eggs, and dairy products, and nutritional health products increasing by 12.7% and 17.4%, respectively. The sales revenue of general retail increased by 9% year-on-year, with the revenue from department stores, supermarkets, and convenience stores increasing by 34%, 8.9%, and 4.4%, respectively.

Liu Yuenan, the chief analyst of commerce, retail, and social services at Guotai Junan Securities, stated that service consumption such as tourism and local life, as well as the internationalization of consumer goods, have seen many positive catalysts on the policy, demand, and supply sides.

Liu Yuenan believes that from the perspective of domestic demand, service and emotional value consumption are structural increments. Consumption is shifting from pursuing functionality to pursuing emotional value. Cost-effective consumption, emotional value consumption, and service consumption have become the three major directions of consumption. From the perspective of external demand, the export of consumer goods is in the stage of transforming from price advantage to establishing brand awareness. From the supply side, the structure of some industries is gradually improving, especially the structure driven by the scale economy and efficiency advantage of leading companies, which has a stronger continuity in profit release. In addition, the core driving force for improvement mainly comes from the efficiency advantage and scale economy of leading companies. With the capital expenditure period behind and stronger pricing power in the industrial chain, the stability of corporate free cash flow will continue to improve. Industries such as education, local life, OTA (Online Travel Agency), fresh retail, and local travel have the most typical structure improvement.

According to data from the Ministry of Commerce, during the National Day holiday, the sales of key retail and catering enterprises nationwide increased by 4.5% year-on-year at a comparable rate, and the passenger flow in key cultivated pedestrian streets and business districts increased by 12.5% year-on-year. Specifically, for the food and beverage industry, Ouyang Yu, the chief analyst of food and beverage at Hua Chuang Securities, believes that the industry's demand resilience is evident, providing practical relief for enterprises. In the short to medium term, the valuation repair direction of food and beverage companies is clear, with sub-industries such as beverages and snacks growing against the trend within the year, while some necessary sub-industries led by industry leaders began to stabilize and improve in the second half of the year. Especially under the low-interest rate cycle and rising macro expectations, there is still room for valuation repair of food and beverage leaders.

"The food and beverage industry will also continue to breed new structural growth opportunities," Ouyang Yu said. Under the long-term trend of consumption, the food and beverage industry has recently cultivated a series of new high-growth tracks, such as snack bulk business formats, standardization of Chinese meal supply chains, coffee, sugar-free tea, and other new sub-formats and tracks, bringing opportunities for industrial investment. These track opportunities still need to be continuously explored. In the future, more structural growth investment opportunities are expected to emerge, such as functional foods and alternative proteins, which are emerging potential tracks.

The textile and apparel industry, as an important part of optional consumption, is also expected to release elasticity. Wang Liping, the chief analyst of the textile and apparel industry at Shenwan Hongyuan Securities Research Institute, said that clothing retail is expected to be stable in the first half of 2024. At the same time, consumer demand is more segmented, leading to increasingly differentiated performance among sub-segments and brands. At present, sports and outdoor are still growing and prosperous tracks. Especially as the industry growth rate tends to be stable, competition among brands intensifies, and cost-effectiveness and differentiated positioning become more and more important. Domestic brands, with their cost-effectiveness advantages and localization operation capabilities, are accelerating to catch up with international brands. In 2021, the rise of sports brands accelerated the capture of market share, in 2023, domestic mid-to-high-end men's clothing brands seized the blank market, and in 2024, cost-effective brands outperformed the industry. Next, as policy continues to exert efforts, domestic demand consumption is expected to continue to recover, and the fundamentals of clothing brands are expected to bottom out and rebound.

Some industry insiders also believe that current service consumption and consumption that satisfies emotional value are structural increments. Various places combine consumption promotion with people's livelihood, boost consumer confidence, and the overall market sales continue to recover, continuously breeding new structural growth opportunities.