China Home Appliance: Sept AVC Data: Weak print raises the burden of proof

September AVC data came in weak, with retail sales down 13% YoY, deteriorating from -9% in July/August despite a much easier comp base. ASP was -11% YoY (vs. -9% in August), while volume slipped to -2% YoY (vs. flattish in August), pointing to both price pressure and softer end-demand. Timing may have distorted the month, with subsidy budgets likely running low and some demand potentially shifting into October promotions. Still, the print lowers our confidence in near-term domestic demand, especially with 3Q results likely to face closer scrutiny. We are not changing our constructive sector view on one month's data, but the burden of proof has moved higher. By category, AC sales were -20% YoY (the largest drag), refrigerator -9% and washing machine -8%. Midea's total market share normalized to 23.5%, while Haier's rose to 26.6%. Management commentary during 3Q results and October sell-through will be key next data points.