【英文】瑞信报告：上海封城及其连锁效应：量化对消费行业的影响（69页）

Including Shanghai, at least 28 large and medium-sized cities in China have announced  lockdown measures since late March, which contributed to ~16.0% of national total retail sales  in China last year. Our on-the-ground observation in Shanghai found foot traffic of offline retail  severely dropped since mid-March. Though easing arrangements by stages in Shanghai have  been announced, the city’s offline activities remain largely muted, while e-commerce and food  delivery are still struggling with logistic and capability challenges. We believe the control  measures imposed have put both online and offline consumption on a downward spiral, and we  see the consumer sector as being at major risk if the prolonged pandemic and further tightening  continue across China. At the same time, we note the proactive stance taken by the  government to shoot for consumption recovery via multiple stimulus measures. CQi survey confirms… The control measures have resulted in a negative outlook and sentiment across the board,  including both employers and households. 

Findings from a CQi survey supports our concerns,  namely a gloomy employment outlook, a deteriorating household income outlook and  consumption sentiment. Service firms have weak hiring plans, reflecting soft household  consumption in 2Q22. Consumers are facing a double-dip in both disposable income and  income expectation, which undermines their willingness to spend money.  Hit almost everywhere Our channel check demonstrates incremental impacts in April are of concern, following visible  downward trends in March. As of mid-April, sectors with expanded decline from last month  include catering, sportswear, aesthetics, as well as certain condiment and home appliance – catering sector’s SSS recovery at approximately 60-80% in March 2022, which further lowered  in April; sportswear’s demand growth slowed down significantly in the second half of March,  with some brands experiencing negative growth into April; while aesthetics companies’ revenue  in March and 1H of April is largely erased. For home appliance, we found monthly sales decline  improved in the second week of April from March, with refrigerator outperforming airconditioners and washing machines.