According to Zhitong Finance APP, Guolian Minsheng Securities released a research report stating that August air conditioning domestic shipments showed stable year-on-year growth. As local trade-in policies rolled out during the same period in 2024, policy effects became evident and domestic sales decline narrowed. Excluding base effect fluctuations, monthly domestic sales maintained stable performance compared to the CAGR for the same periods in 2023/2019. Looking ahead, both domestic and export AC shipment bases from September to December are relatively high, with growth rates likely to decelerate. Since Q3, the white goods sector has shown weak performance, and with base effects, policy impacts, and tariff influences on short-term pricing likely fully reflected, relative valuations have fallen to historical lows while leading companies maintain resilient operations. Current policies support domestic demand, overseas markets may have passed the bottom of this cycle, and interest rate cuts favor demand recovery, keeping the overseas expansion logic intact.

**Guolian Minsheng Securities' main views are as follows:**

**Industry Online Released August AC Production and Sales Data** Monthly household AC production reached 12.88 million units, up 9.43% year-on-year, with sales of 13.02 million units, down 1.04% year-on-year. Domestic sales totaled 7.74 million units, up 1.22% year-on-year, while exports reached 5.29 million units, down 4.18% year-on-year. End-of-period inventory stood at 14.57 million units, up 0.41% year-on-year.

By manufacturer: Gree's monthly sales declined 3.39% year-on-year (domestic flat, exports down 10.53%); Midea fell 9.21% year-on-year (domestic down 17.31%, exports up 8.33%); Haier rose 15.63% year-on-year (domestic up 27.12%, exports down 16.67%); Hisense sales increased 6.71% year-on-year (domestic up 50.00%, exports down 22.95%); Changhong declined 48.65% year-on-year (domestic down 31.03%, exports down 60.00%); TCL rose 2.86% year-on-year (domestic down 8.00%, exports up 6.25%).

**Domestic Shipments Stable, Consistent Sales Trends** August AC domestic shipments showed stable slight year-on-year growth. As local trade-in policies gradually took effect during the same 2024 period, policy drivers became apparent and domestic sales decline narrowed. Excluding base fluctuations, monthly domestic sales showed stable CAGR performance versus the same periods in 2023/2019.

On the terminal side, August Aowei data showed AC omni-channel retail volume/price up 1%/-1% year-on-year respectively, with stable sales momentum. Midea's installation card base grew higher but weakened month-on-month, while Haier continued rapid growth.

Looking forward, starting September 2024, policy implementation will drive shipment elasticity with 9-12 month shipments up 20% year-on-year, facing a high base. Extrapolating linearly from August's CAGR versus the same 2019 period, 9-12 month domestic shipments may decline 6%-7% year-on-year, though operational pressure may remain manageable under policy support.

**Downplaying Rhythm Fluctuations, Stable Foundation Unchanged** August domestic AC sales for Midea/Gree/Haier were down 17%/flat/up 27% year-on-year respectively, with Hisense/Aux up 50%/56% respectively. Leading companies showed divergent performance, with Haier and Hisense maintaining high growth.

Recent Industry Online monitoring shows significant fluctuations in manufacturers' domestic sales growth rates, mainly due to: 1) Base differences caused by different participation rhythms during policy launch phases; 2) Post-618 price trends for Midea/Haier systems moving upward month-on-month. August Aowei monitoring showed Midea AC online/offline retail average prices up 6%/flat year-on-year respectively, compared to down 9%/4% year-on-year in H1 2025. In a weak demand environment, volume growth gives way to pricing.

Haier's August installation cards rose over 20% year-on-year, continuing the growth momentum, with 1-8 month domestic shipment market share up 1pct year-on-year to 14%.

**Export Decline Narrowing, Continued Improvement Expected** August household AC export volume declined 4% year-on-year, with significantly narrowed decline potentially marking a second-order inflection point. Leading companies' export orders may have recovered in July-August, with subsequent shipment-end recovery trends relatively clear.

Following the May China-US Geneva agreement, on August 12, it was announced that implementation of the 24% tariff increase would continue to be suspended for 90 days, with ongoing negotiations requiring continued monitoring. The US has begun a new round of interest rate cuts, which should help drive real estate chain recovery.

Considering September-December 2024 AC export volume up 47% year-on-year and the impact of front-loaded shipments, growth rates should gradually converge toward the mid-single-digit historical center after digesting short-term pressures. White goods leaders' emerging market layouts are advanced, with overseas production transfers continuing, and performance during the recovery phase expected to exceed linear expectations.

**Maintaining "Outperform" Industry Rating** August AC domestic sales were stable, with manufacturers showing divergent performance under base and pricing strategy influences, with Haier/Hisense performing better. Export decline narrowed, likely confirming a second-order inflection point, with long-term overseas expansion logic intact.

Looking ahead, September-December AC domestic and export shipment bases are both relatively high, with growth rates likely to decelerate. Since Q3, the white goods sector has shown weak performance, and with base effects, policy impacts, and tariff short-term pricing influences likely fully reflected, relative valuations have fallen to historical lows while leading companies maintain resilient operations.

Current policies support domestic demand, overseas markets may have passed the bottom of this cycle, and interest rate cuts favor demand recovery, keeping overseas expansion logic intact. White goods leaders offer high quality and high dividends. We continue to recommend Midea Group (000333.SZ), Haier Smart Home (600690.SH), Hisense Home Appliances (000921.SZ), and Gree Electric Appliances (000651.SZ).

**Risk Warnings** Policy implementation falling short of expectations; raw material price and exchange rate fluctuations; tariff and external demand risks falling short of expectations.