Haier Smart Home (6690 HK)
The Chinese appliances giant winning globally
Haier is one of China’s “big three” appliance makers, alongside Midea and Gree. Among them, Haier stands out as the leader in large appliances, holding the top position in sales volume for refrigerators and washing machines both in China and globally. Haier is also the most internationally focused of the three, with 60% of its sales coming from markets outside China.
So why Haier (and why now)?
With the introduction of the trade-in subsidies for home appliances in the second half of last year (which was further expanded in scope in January), China has downside support thanks to policy. On the international front, growth has been impressive, particularly in Europe where sales have grown organically at 20% CAGR with Haier rising quickly to become a major competitor to industry leader Bosch (BSH) in recent years. Haier has a capable management team with a solid track record in overseas M&A, including the successful turnaround of GE Appliances which was acquired in 2016, and continues to outperform in the North American market.
My investment thesis has five main points:
1) International growth: Over the past decade, Chinese and Korean appliance makers have steadily gained market share in nearly every major international market, while Western makers like Whirlpool and Electrolux have ceded ground — a trend which is expected to continue. A historically weak yuan (with potential for further devaluation in 2025) should provide additional tailwind.
2) China offers robust policy support: In China, Haier held a 28% overall market share in home appliances in 2023, with a particularly dominant 40-50% share in the refrigeration and laundry segments. In the second half of last year, the Chinese government introduced a trade-in subsidy program targeting eight categories of home appliances, making Haier a key policy beneficiary. In January 2025, this policy was expanded in scope, underscoring the government’s continued focus to support consumer spending.