Stable industry growth and clear regional layout; From indicators such as assets, enterprise size, sales revenue, and profits, the packaging and printing industry is mainly concentrated in the East and South China regions, accounting for a total of over 60%.

The overall supply of the industry exceeds demand, and there is a structural imbalance between supply and demand. The industry suffers from serious low-level redundant construction, general overcapacity, and insufficient production capacity for refined products, resulting in a structural imbalance between supply and demand in the industry. We believe that the overall trend of the industry showing a turning point is not clear.

There are several reasons for this: the entry threshold for low-end products is low, and scales such as tens of thousands or hundreds of thousands can be involved. It is expected that supply will always exceed demand, and the industry's gross profit margin will remain relatively stable at most, and there will definitely be no significant upward trend. Due to factors such as funding, technology, and printing qualifications, high-end products have a high entry threshold and can maintain a high gross profit margin.

Specifically, due to the characteristics of the industry's order sales model, industry supply is driven by demand, and balanced output is determined by the demand side, which involves multiple downstream industries. Therefore, the growth rate of GDP is closely related, and the growth rate of demand can be guaranteed.

Due to the constraints of high threshold factors, there will not be a significant increase in short-term supply. Therefore, the current high gross profit margin level can be maintained for a certain period of time, but there will not be a significant improvement (currently, the packaging and printing industry reserves a certain amount of production capacity due to the characteristics of order sales models, and orders are greatly limited by regional factors). The possibility of industry integration is very small.

The main reason is that it is constrained by factors such as the nature of the enterprise and regional characteristics, and it is also difficult to operate. Opportunities exist in individual stocks, and the key lies in the ability of enterprises to obtain orders.