"Height increase limit" strong incoming bathroom hardware twists and turns

2011 and the bathroom industry, the property market New Deal, the central bank to raise interest rates, purchase restrictions and other series of measures to the sanitary ware company has brought a great impact, the corresponding will also have an impact on the hardware industry. Then whether the bathroom hardware company will encounter difficulties and how the prices of hardware products will change, it is a problem worthy of our attention.

It is understood that the impact of raising interest rates is limited. On February 9, 2011, the financial institutions have raised their benchmark interest rates. The one-year benchmark deposit rate of financial institutions increased by 0.25 percentage points, while the interest rate over five years or more related to mortgages increased by only 0.2%, but the interest rate reached a high of 6.60%.

The impact of interest rate hike on hardware companies is mainly due to two aspects. On the one hand, China's interest rate hikes will reduce the momentum of investment in fixed assets. In the short term, it will affect the demand for hardware products and bring down pressure on the hardware market. It is inevitable that the increase in interest rates will result in an increase in the cost of funds, which will affect hardware manufacturers.

On the other hand, raising the interest rate will also increase the capital cost of China's sanitary hardware companies, which is not conducive to the company's fund raising. However, it can reduce the momentum of the expansion of hardware companies in the long term, and the business climate is expected to continue to stabilize. Therefore, China's interest rate hike is short-term bearish for the hardware industry, which will be beneficial for a long time.

Fluctuations in the price of hardware products have limited expert opinion, and the price of sanitary hardware products will not be affected by the rate hike in the short term. First of all, in hardware trading, many bathroom hardware dealers have signed large purchase orders with manufacturing companies years ago. This part of the price has been solidified, and the impact of raising interest rates will not be affected here. Second, at present, the hardware manufacturing industry is basically in a state of oversupply, and there are large chips in the hands of manufacturers. Therefore, even if the actual cost of funds increases, the price fluctuations are limited.

As the most important force in Chinese enterprises, the small and medium-sized hardware companies in the bathroom hardware industry are in the majority, the investment of the company's managers is small, and the asset-liability ratio is not high. Therefore, the risks of increasing production costs and reducing corporate profits are not high. On the contrary, in order to increase profit margins, these companies will inevitably increase R&D efforts, improve product quality and grades, and accelerate the transformation and upgrading of the hardware industry.

Compared with raising interest rates, the impact of purchase restrictions on the bathroom hardware industry will be more complicated.