EB SECURITIES: The recovery process of social consumption retail in March exceeds expectations, with the significant effect of consumption boosting policies.

EB SECURITIES released a research report stating that the total retail sales of social consumption in March 2025 exceeded expectations, with the main essential/optional categories performing well. In terms of specific categories, essential categories such as grain and oil food products achieved double-digit growth, corresponding to a 9.9% year-on-year growth in retail sales of convenience store formats in the first quarter of 2025. Among optional categories, the jewelry category was influenced by the upward trend in gold prices, leading to accelerated growth on a month-on-month basis. The related categories of national subsidies continued their high growth trend, with sports and entertainment supplies, home appliances and audiovisual equipment, cultural and office supplies, furniture, and communication equipment categories all exceeding 20% year-on-year growth. The main points of EB SECURITIES are as follows: -Total social consumption in March 2025 increased by 5.9% year-on-year, with a 1.9 percentage point increase from the previous month. -On April 16, 2025, the National Bureau of Statistics released social consumption data: the total retail sales of social consumer goods in March 2025 was 4.09 trillion yuan, a year-on-year increase of 5.9% (market consensus expectation was 4.36%), with a 1.9 percentage point increase in growth compared to January-February. The retail sales of goods from above-quota enterprises (units) were 1.59 trillion yuan, a year-on-year increase of 8.6%, with a 4.2 percentage point increase in growth compared to January-February. From January to March, the total retail sales of social consumer goods amounted to 12.47 trillion yuan, with a year-on-year increase of 4.6%, a 0.1 percentage point decrease compared to the same period last year. (Unless otherwise stated, January-February/March in this article refers to January-February/March 2025). -In March 2025, the CPI growth rate increased by 0.6 percentage points compared to February, with an increase in essential goods. -In March 2025, the national CPI year-on-year growth rate was -0.1%, compared to -0.7% in February. The month-on-month CPI growth rate in March increased by 0.6 percentage points. In March, among the relevant categories in the supermarket industry, the retail sales of grain and oil food products increased by 13.8% year-on-year, a 2.3 percentage point increase compared to January-February. The retail sales of beverages increased by 4.4% year-on-year, a 7.0 percentage point increase compared to January-February. The retail sales of daily necessities increased by 8.8% year-on-year, a 3.1 percentage point increase compared to January-February. -The retail sales of textile and clothing increased by 3.6% year-on-year, while the retail sales of cosmetics increased by 1.1%. -In March 2025, among the relevant categories in the department store industry, the retail sales of textiles and clothing increased by 3.6% year-on-year, a 0.3 percentage point increase compared to January-February. The retail sales of cosmetics increased by 1.1% year-on-year, a 3.3 percentage point decrease compared to January-February. -The retail sales of the gold and jewelry industry increased by 10.6% year-on-year, a 5.2 percentage point increase compared to January-February. -In March 2025, among the relevant categories in the gold and jewelry industry, the retail sales of jewelry and precious metals increased by 10.6% year-on-year, a 5.2 percentage point increase compared to January-February. -The retail sales of household appliances increased by 35.1% year-on-year, a 24.2 percentage point increase compared to January-February. -In March 2025, among the relevant categories in the real estate industry, the retail sales of household appliances increased by 35.1% year-on-year, a 24.2 percentage point increase compared to January-February. The retail sales of furniture increased by 29.5% year-on-year, a 17.8 percentage point increase compared to January-February. The retail sales of building and decoration materials decreased by -0.1% year-on-year, a 0.2 percentage point decrease compared to January-February. -Other Categories: Retail sales of tobacco and alcohol increased by 8.5% year-on-year, a 3.0 percentage point increase compared to January-February. Retail sales of communication equipment increased by 28.6% year-on-year, a 2.4 percentage point increase compared to January-February. Retail sales of cultural and office supplies increased by 21.5% year-on-year, a 0.3 percentage point decrease compared to January-February. Retail sales of traditional Chinese and Western medicines increased by 1.4% year-on-year, a 1.1 percentage point decrease compared to January-February. Retail sales of sports and entertainment supplies increased by 26.2% year-on-year, a 1.2 percentage point increase compared to January-February. -Risk Warning: Macroeconomic growth and household income growth may not meet expectations, post-real estate cycle effects may impact the growth of certain sub-industries, and the impact of channel changes on existing business models may be higher than expected.