Orient Securities released a research report stating that while the domestic subsidy-driven effect is marginally slowing, the optimization and extension of the "Two New" policies are expected to activate greater consumption potential in the home appliance sector. Leading white goods companies, with their higher proportion of Tier-1 energy efficiency products and more mature internal management processes for trade-in programs, stand to benefit more significantly. Overseas expansion remains a long-term focus, with companies boasting diversified production capacity layouts holding an advantage. The firm maintains a positive outlook on the steady operational capabilities of leading home appliance manufacturers.
Key points from Orient Securities are as follows:
1. **"Two New" Policies to Stimulate Consumption Potential** The Central Economic Work Conference concluded on December 11, 2025, emphasizing "domestic demand-driven growth and building a strong domestic market." The conference highlighted the optimization of policies such as "large-scale equipment renewal and trade-in programs" and proposed deepening the integration of "AI+" applications. On the external front, measures to promote duty-free trade, digital/green commerce, and improvements in overseas service systems and free trade zones are expected to benefit export chains and cross-border channels. According to Ministry of Commerce data, from January to November 2025, over 128.44 million home appliances were traded in under replacement programs, driving sales of related goods exceeding RMB 2.5 trillion and benefiting more than 360 million consumers. The report suggests that the extension of the "Two New" policies will sustain demand-side stimulus through subsidies and trade-in programs, while "AI+ consumer hardware" (e.g., cleaning appliances, home service robots, AI glasses, action cameras/drones) emerges as a structural growth driver.
2. **Limited Impact of Mexico’s Tariff Hike on Chinese Home Appliance Firms** On December 10, 2025, Mexico’s House of Representatives approved a draft tariff bill imposing additional duties on imports from non-free trade agreement (TLC) countries, including China, India, Vietnam, and Thailand, effective January 1, 2026. The measure covers 18 tariff lines in the home appliance sector, with rates for refrigerators (30%, up 20 ppts), air conditioners (30%, up 15 ppts), washing machines (30%, up 20 ppts), rice cookers (20%, up 15 ppts), and water heaters/ovens (25%, up 15 ppts). However, as Mexico primarily serves as a production hub for Chinese brands targeting North America, its market contribution to overall revenue is minimal, resulting in negligible operational impact.
3. **Rising Share of MiniLED TVs; RGB-MiniLED as Next-Gen Display Tech** Trade-in subsidies over the past year have effectively educated consumers. In November 2025, MiniLED TVs accounted for 43% of online sales (up 21 ppts YoY) and 40% offline (up 13 ppts YoY). With natural penetration growth and catalysts like global sporting events in 2026, Chinese brands are poised to gain further market share globally, leveraging mature supply chains and product competitiveness. RGB-MiniLED, which enhances picture quality via tri-color backlight control, is emerging as the next-gen display upgrade. During the 2025 Double 11 shopping festival, RGB-MiniLED outperformed OLED in cost-performance for similar sizes, positioning it as a key tool for Chinese brands to capture the premium global TV market.
**Investment Recommendations:** - **Main Theme 1:** Leading firms with operational efficiency, mature overseas capacity, and high dividend yields (e.g., Midea Group, Haier Smart Home, Hisense Visual). - **Main Theme 2:** Overseas expansion as a long-term driver, with potential valuation re-rating in 2026 (e.g., Roborock). - **Main Theme 3:** Companies with stable core performance and potential secondary growth curves (e.g., Anker Innovations).
**Risks:** Uncertainty over trade-in subsidy disbursement timelines and recurring tariff disruptions.
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