Morgan Stanley: Regional policy response is positive, expecting Haier Smart Home, Midea Group, and JD.com to benefit

Morgan Stanley's research report stated that China's earlier announcement of subsidies for consumers to replace household appliances has received positive responses from regional policies. The bank believes that the policy has begun to show results in the retail sales of white goods, estimating that sales of appliances with higher energy efficiency levels and market leaders will benefit more. The bank pointed out that Haier Smart Home is the preferred choice in the industry, followed by Midea, and JD will also benefit from the policy. Morgan Stanley mentioned that data shows that retail sales in regions where the policy has been implemented have seen growth. Since the implementation of the policy, Haier's retail sales in Hubei have grown at an annual rate of 30%. The bank believes that it will take time for retail sales to translate into brand income, and companies also need to reach agreements with local governments on subsidy amounts. Currently, the bank expects the overall sales in the industry to benefit the most in the fourth quarter