Glonghui, May 24 丨 According to the Daiwa Development Research Report, more than 20 domestic demand companies have been interviewed since the beginning of the year. They all pointed out that the recovery in consumption was disappointing. There was a “K-type” recovery in the market, that is, the performance of high-end and low-end consumption is superior to that of mid-range consumption. Although most companies are optimistic that summer spending should improve, the bank is increasingly cautious about “recovery in the second half of the year.” As a result, the bank is more optimistic about undervalued consumer stocks and the consumer sector that can better withstand downward profit corrections. The bank mentioned that many companies still expect consumption to continue to strengthen in the second half of this year. They believe that overall consumer spending capacity is still strong, but consumers are still watching and may be waiting for macroeconomic recovery or a truly stable epidemic situation. The bank is optimistic about industries with low historical valuations and a recovery in profit margins, so in the short term, it favors essential consumer goods, such as Master Kong (0322.HK) and Erie (600887.SH), and believes this will be more defensive when the pace of consumer recovery is uncertain. In terms of non-essential consumer goods, the bank is optimistic about Shenzhou (2313.HK), Yu Yuan (0551.HK), and L'Occitane (0973.HK).