At present, the market sentiment has reached the lowest point in nearly three years, the main stock indexes and industries have been fully adjusted, and there is a rebound foundation in the follow-up. Although the current China US monetary policy cycle is in a “dislocation period” and China is facing the pressure of global liquidity tightening, China’s current easing cycle is not over due to China’s economic fundamentals cycle and policy independence. For a shares, we believe that the impact of “internal loosening” is greater than that of “external tightening”, The current strong RMB exchange rate will provide greater support for the independence and flexibility of China’s monetary policy. Therefore, although the current market has a lot of worries about the future market, we are still confident in the stabilization and rebound of the market after the festival.
it is suggested to grasp the three lines of counterattack : 1) wide currency and wide credit continue to increase, and the stable growth market will continue to deduce; 2) At present, the high prosperity of some high-quality growth stocks is still supported by fundamentals, and the valuation contraction is expected to come to an end. The market began to respond to the expectations of the first quarterly report, and ushered in a counterattack after further verification of fundamentals; 3) The global Omicron epidemic has ushered in an inflection point. Some consumer varieties currently greatly affected by the epidemic are expected to benefit from the improvement of the epidemic and the support of China’s policy of expanding domestic demand.
recommendation logic
\u3000\u3000 01 Quzhou Wuzhou Special Paper Co.Ltd(605007)
1. The company is a small and beautiful special paper company with food packaging paper as the core. By the end of 2021m6, it has a paper production capacity of 850000 tons: 280000 tons of food packaging paper (leading in China), 210000 tons of grasin paper (the largest in China), 7000 tons of tracing paper (40% of the market), 50000 tons of transfer paper and 300000 tons of cultural paper.
2. In 2020, the “reinforced plastic restriction order” of the national development and Reform Commission and the Ministry of ecological environment put forward the requirements of plastic restriction and reduction by 2025, and replacing plastic with paper is one of the directions. Instant catering businesses such as takeout catering, ready-made tea and baking bring new demand for paper packaging. It is expected to bring demand for 1.55 million tons of food paper by 2025, with a space increase of nearly 80% in the next five years. The company’s production capacity of 500000 tons of food packaging paper (with a market share of more than 30% after being put into operation) is expected to be put into operation by the end of 2021, and 200000 tons of liquid paper packaging is expected to be put into operation by the end of 2023, with great medium-term growth flexibility.
3. Downstream customers of food packaging paper attach importance to product safety and service coordination. It takes a long period (1-3 years) to enter food customers. Quzhou Wuzhou Special Paper Co.Ltd(605007) is the main supplier of noodle bowl paper for customers such as Master Kang and uni president, and supplies goods to large chain catering enterprises in China through downstream factory customers. On the production side, the company mostly adopts second-hand equipment, and the price is far lower than that of new equipment. Under the large production line mode, the turnover efficiency of fixed assets and the rate of return on factor investment are higher, and roe and ROA are at a high level in the industry.
\u3000\u3000 02 Shenzhen Jinjia Group Co.Ltd(002191)
1, the tobacco standard leading power China’s new type of tobacco has been realized from the flavor and flavor matching materials smoking tool brand channel layout, China’s regulatory policy is gradually clear, the new tobacco business will bring new growth points for the company, 21Q1-3 revenue is 104 million yuan (+27.5%);
2. With the promotion of bidding, the main business of cigarette label is expected to gradually improve, and the expansion of wine box category is expected to bring new performance increment;
3. The equity incentive target is based on the net profit attributable to the parent company in 2020. The performance growth rate from 2021 to 2023 is not less than 22%, 50% and 85% respectively. The corresponding assessment requirements for the net profit attributable to the parent company from 2021 to 2023 are not less than RMB 1.005/12.36/1.524 billion respectively, and the corresponding 21-23 CAGR is 23.1%, which shows the confidence of the company in rapid development.
\u3000\u3000 03 Yuanli Chemical Group Co.Ltd(603217)
(1) dimethyl dicarboxylate is gradually lifting the restrictions on the supply of raw materials (the production and sales of adipic acid is expected to increase greatly driven by downstream PBAT and nylon 66, so as to ensure the supply of by-product dicarboxylic acid), and the potential growth space of demand is up to millions of tons;
(2) the diol business is expected to see a further rebound in volume and price, the company’s commencement will further recover, and the demand side HDO and PDO are expected to seize part of the share of BDO;
(3) there will be abundant reserve projects in the next 1-2 years: polycarbonate diol phase I 2000 tons, 35000 tons of hindered amine light stabilizer, dimethyl ester capacity expansion of 60000 tons, and gradually increase the production capacity of diol.
04 satellite chemistry
(1) the production capacity of acrylic acid has been expanded in an orderly manner, and the cost and advantage scale of C3 chain have been expanding: the 360000 ton acrylic acid project has been put into operation in the first quarter of 21, and the gross profit margin of the product is more than 10 PCT higher than that of the same industry;
(2) get through the import of ethane to ethylene, and C2 business set sail with the wind: the company is a pioneer in the import of ethane to ethylene project in China. The 1.25 million ton ethylene project was put into operation in 21 years and gradually contributed to the performance;
(3) layout new materials and embrace new energy: the proposed new materials industrial park includes ethanolamine, polystyrene, a-olefin and Poe, carbonate and other projects.
\u3000\u3000 05 Bank Of Ningbo Co.Ltd(002142)
(1) the revenue and profit are both strong. The growth rate of revenue in 2021 remains the first among listed banks. The compound annual growth rate of revenue and profit from 2018 to 2021 reached 22.1% and 20.4% respectively, showing the sustainability across the cycle.
(2) the position of banks with the best asset quality was strengthened. The non-performing rate of 4q21 was further reduced by 1bp to 0.77%, which was far lower than that of peers. The provision coverage rate continued to increase on the basis of exceeding 500%, and the leading position of asset quality was consolidated.
(3) there will be no new refinancing to suppress the valuation in 2022. Supported by the excellent fundamental trend, the stock price performance is expected to lead the sector.
\u3000\u3000 06 Cosco Shipping Holdings Co.Ltd(601919)
(1) the long-term association price may exceed the expectation, and the spot freight rate is high and upward. In the fourth quarter, the SFCI composite index increased by 137.88% year-on-year and 8.93% month on month; Among them, the European route and the US West Route increased by 4.59% and 18.24% month on month respectively, and the freight rate increased significantly. According to JOC’s logistics information, in October 2021, the US West offer was US $6000-7000 / feu. At present, the US West offer is more than US $8000 / feu.
(2) in the first three quarters of 2021, the company’s EBIT was about $14.8 billion, surpassing Maersk’s EBIT of about $13 billion in the first three quarters; According to the latest exchange rate, the company’s EBIT in 2021 was about US $20.790 billion, higher than the US $19.804 billion predicted by Maersk, and the company’s profitability is still in the first tier in the world. Maersk’s effective tax rate is only 4% ~ 5%. After making up for historical losses, the effective tax rate is expected to increase from 5.45% in 2020 to more than 20%.
(3) at the end of the fourth quarter of 2021, the undistributed profit on the balance sheet of the parent company is expected to be about 27.78 billion yuan. According to the latest Cosco Shipping Holdings Co.Ltd(601919) articles of Association (effective in December 2020), in principle, the accumulated profits distributed by the company in cash in the last three years shall not be less than 30% of the average annual distributable profits realized in the last three years, and the corresponding dividend amount is about 27 billion.
Historically, the company has not paid cash dividends for ten years. We speculate that the undistributed profit of 27.8 billion may return 100% of the dividends to investors.
\u3000\u3000 07 Quakesafe Technologies Co.Ltd(300767)
(1) vibration reduction and isolation leader, accounting for more than 30% of the market: the company provides an integrated vibration reduction and isolation solution. At present, the company has a production capacity of 50000 sets and more than 110000 sets under construction. It is planned to put all of them into operation within this year. At present, the capital gap required for the expansion of the company is small.
(2) the merger and acquisition of Changzhou Green has cut into the field of nuclear power equipment vibration damping, and the prototype of “double control of vibration and vibration” has initially appeared: Changzhou Green’s main mature product market covers civil nuclear power, thermal power, iron and steel metallurgy and petrochemical industry, which is a milestone for the company to extend to the field of equipment vibration damping.
(3) with the implementation of the regulations, the industry is expected to achieve about 20 times the current market scale in the short term: the regulations on the administration of earthquake resistance of construction projects was officially implemented on September 1. The application of seismic reduction and isolation technology in public buildings such as schools and hospitals in high intensity areas and key earthquake monitoring and defense areas will become mandatory regulations, and the application scope will be spread from Yunnan and other individual areas to the whole country. We believe that the future industry space will reach more than 40 billion, about 20 times that of the current industry.
\u3000\u3000 08 Seazen Holdings Co.Ltd(601155)
(1) the company’s commercial real estate has completed the national layout and is about to usher in the release of performance.
(2) the sales scale increased slightly, the land acquisition returned to the Yangtze River Delta, and the safety margin increased.
(3) it is financially sound. The remaining bonds due in 2022 are about 12.4 billion yuan, with little debt repayment pressure.
09 Power Construction Corporation Of China Ltd(Powerchina Ltd)(601669)
(1) Power Construction Corporation Of China Ltd(Powerchina Ltd)(601669) is a giant in the field of power engineering in China and even the world. It has the ability of whole industry chain services such as planning, survey, design, construction, operation, equipment manufacturing, investment and financing, and can provide one-stop comprehensive services for owners.
(2) increase investment in new energy and pumped storage construction, and there is broad development space in the 14th five year plan.
(3) after asset replacement, the company’s assets are optimized, the company’s income is thickened, the assets of the real estate sector are placed, and the assets related to high-quality power grid auxiliary industries are placed.
\u3000\u3000 10 China Resources Sanjiu Medical & Pharmaceutical Co.Ltd(000999)
1. With thick accumulation and thin hair, we are committed to becoming a leader in the public health industry.
2. “The 14th five year plan” strategy: implement the incentive mechanism, continue to focus on the main business and promote the digital strategy.
3. Excellent M & A integration ability to support the company’s core strategic development.
\u3000\u3000 11 China Stock Market News
(1) “Dongcai 3” early redemption announcement was issued, boots landed, and the overall rhythm was in line with expectations; Short term dilution of EPS and increase of capital are conducive to the development of the company’s securities business and further enhance the company’s liquidity.
(2) the market share of the company continues to increase, and the development of securities business and fund business is faster than that of the industry.
(3) the one-stop wealth management platform for residents continues to benefit from the great development of wealth management.
\u3000\u3000 12 Wens Foodstuff Group Co.Ltd(300498)
1. The downturn in the aquaculture industry caused the company to lose money for the first time in nearly a decade.
2. The pig breeding business has been continuously optimized, and the breeding cost is expected to continue to decline.
3. The poultry business is at a good historical level, and the whole year is profitable.
4. The inflection point of the company’s operation has emerged, and the medium and long-term allocation value appears. Although the current pig breeding industry is still at a low point of prosperity, the company’s business indicators have gradually recovered. In the future, the company will continue to do a good job in the dual control of self breeding pig seedlings and breeding costs, and wait for the market to pick up, which is expected to turn losses into profits; The prosperity of yellow feather chicken breeding business is expected to rebound, and the profit of the company’s poultry business is expected to continue to grow; In addition, the company has sufficient capital reserves, with current working capital of more than 12 billion yuan and many financing channels.
\u3000\u3000 13 Shanghai Electric Power Co.Ltd(600021)
1. The coal price was controlled and the electricity price rose, and the thermal power business hit the bottom and rebounded in 2022.
2. In the 14th five year plan, 11gw of green power will be added, and the scale of green power will grow steadily. 21q4 Rudong 800000kw Haifeng grid connection will contribute to the deterministic performance increment in 2022.
3. The equity incentive plan is expected to stimulate the subjective initiative of the management.
\u3000\u3000 14 Jiangsu Zhongtian Technology Co.Ltd(600522)
1. Asset impairment landing and risk clearing.
2. The company’s marine business scope covers marine engineering such as submarine cable production and laying, fan hoisting, etc. Haina is the first overseas company with the capacity of 52.1 billion DC cables, which has passed the appraisal of Haina’s new DC transmission project in the first half of the year. At present, Haina is the first overseas company with the capacity of 52.1 billion DC cables. The company’s Guangdong submarine cable production capacity has reached the production capacity first, more than 1.5 years earlier than its peers, which is expected to seize the development opportunity of the Guangdong market.
3. The company has deeply arranged photovoltaic, energy storage and other new energy businesses, and obtained the photovoltaic development right of Rudong beach resources. Under the leverage of resources, the total photovoltaic output value of the company is expected to exceed 30 billion yuan.
\u3000\u3000 15 Shenzhen Sed Industry Co.Ltd(000032)
(1) backed by CEC, the company provides chips, operating systems, network security ( Qi An Xin Technology Group Inc(688561) ), collaborative office (Lanxin, benchmarking nails) and the safest cloud for application integration from the bottom to the top. The company mainly builds cloud platform and upper application development, which absolutely meets the national requirements for cloud security in terms of security and identity. The target customers are the government, central enterprises and state-owned enterprises;
(2) the company’s incentive in place can attract technical talents such as Alibaba cloud and huaweiyun, ensure the leading technology, and eliminate the market’s habitual thinking of poor marketization mechanism and weak technology of state-owned assets background;
(3) strong expectation of asset injection: 96.7% of the equity of China system will be injected in 21 years (currently the company’s main business is clean room and Cloud Computing), 35.5% of the equity of Lanxin will be acquired from CEC at the end of 21 years, and the company will increase its capital with CEC. At present, it controls 63% of the equity (the company’s main business is digital construction in Guangdong Province, such as “Guangdong Provincial affairs”, and Tencent previously accounted for 49%).
\u3000\u3000 16 Sinoma Science & Technology Co.Ltd(002080)
(1) Sinoma Science & Technology Co.Ltd(002080) is a platform company with obvious resource advantages. It has formed three main businesses of glass fiber + blade + lithium film through long-term mergers and acquisitions, with a deep layout of high-quality tracks.
(2) glass fiber: the glass fiber and products of Taishan glass fiber have reached the capacity scale of one million tons, and focus on the development of high-end glass fiber products. The gross profit margin is significantly ahead of small and medium-sized glass fiber enterprises. It is expected that the roving price will remain stable at a high level in 2022, which will support the revenue and profit of the company’s glass fiber business.
(3) blade: Sinoma blade has seven industrial bases and has the design capacity of wind power blade with an annual output of 10 million KW, ranking among the top three in the global wind power blade manufacturing industry. Compared with other leading enterprises, the company’s revenue side is synchronized with the profit side to maintain a leading edge.
(4) lithium film: invested to acquire 60% equity of Hunan Zhongli in 2019 and completed asset integration in 2021. It is estimated that by the first quarter of 2022, the total production capacity will exceed 1.6 billion square meters, and the long-term planned production capacity will be 2.08 billion square meters, which is expected to significantly improve the lithium film supply capacity from 2023 to 2024.
\u3000\u3000 17 Visual China Group Co.Ltd(000681)
(1) the main business of picture copyright agency has recovered significantly, and the company is also expanding medium and long tail customers and video categories.
(2) the field of digital collections has the advantages of resource + community platform.
The company acquired Corbis in 2016, which basically includes the precious pictures of the main cultural, historical and symbolic values of the western world. This part is its own assets, and there is no need to share it with a third party for future sales.
(3) the overseas photographer community 500px acquired by the company in 18 years is expected to attract users with unique community tonality and high-quality picture quality. In addition, the platform precipitates a number of fans with high viscosity and high activity, which is expected to become a sub-user of the overseas digital collection platform. At present, the Chinese digital collection platform yuan vision has been launched. As of January 26, the cumulative transaction volume was 2.8607 million yuan, and the company’s consumer business has been opened.
\u3000\u3000 18 Midea Group Co.Ltd(000333)
(1) the valuation of the B-side business is expected to rise in the future. At present, Midea’s b-end business includes four major sectors: industrial technology, building technology, digital innovation and Siasun Robot&Automation Co.Ltd(300024) and automation. We expect that the revenue of the company’s b-end business will account for about 25% in 2021, and the b-end business is in a competition road with huge capacity and bright prospects (volume of 100 billion to 100 billion), and the growth rate will continue to be higher than that of 2C end. Quantitative change leads to qualitative change. There is an opportunity to transform Midea from a C-end company into a global technology enterprise in the market. The benchmarking company will change from Haier and Gree to a comprehensive industrial group like Siemens, Philips and general electric.
(2) the company’s diversified business will not have the problem of valuation discount. Midea’s diversified business layout has strong internal coordination and correlation, rather than random connection of related businesses.
\u3000\u3000 19 Ningbo Ronbay New Energy Technology Co.Ltd(688005)
(1) lock in large orders of high nickel cathode such as Ningde and Funeng, and overseas customers are also making continuous breakthroughs, benefiting from the improvement of global high nickel cathode penetration rate, and the shipment growth in 22 years is determined;
(2) leading the industry in capacity expansion, with a capacity of 120000 tons at the end of 21 and expected to exceed 200000 tons in 22 years. The production line is rapidly iterated, the production efficiency continues to improve, the investment per unit capacity is ahead of its competitors, and the manufacturing cost advantage is prominent;
(3) the profit per ton is expected to remain stable. The continuous introduction of new products such as ultra-high nickel and the leading speed of R & D iteration bring about relatively excess returns on the profits of new products.
\u3000\u3000 20 Zhejiang Chint Electrics Co.Ltd(601877)
1. The company is a dual leader of low-voltage appliances + household photovoltaic.
2. Low voltage electrical appliances: the company has the most sound and in-depth sales channel network in the industry, which can cover more than 96% of primary and secondary channels and prefecture and municipal channels. It is the core barrier for the company to maintain the leading market share. In addition, the company’s direct sales channels and overseas channels increased rapidly, and the sales from January to September 2021 increased by 64.6% and 49.2% respectively year-on-year.
3. Household PV: with the help of the experience of low-voltage electrical channels, the company once again gave play to the advantage of 2C land promotion, occupied 25% of the market share in the decentralized household PV market, and the leading position is stable. At present, the whole county of distributed photovoltaic is advancing rapidly. Due to its large business volume and strong development capacity of household photovoltaic in the whole county, the company is the preferred partner for central enterprises to acquire household power station resources in the whole county. Under the background of promoting the whole county, the performance of the company’s household photovoltaic business is expected to double from 2022 to 2023.
4. Performance split: it is estimated that the company’s net profit deducted from non parent company in 2022 will be about 5.8 billion yuan (33.6% for low-voltage appliances and 24.3% for photovoltaic), corresponding to 18 times of the market value of PE on December 29. It is highly recommended.
\u3000\u3000 21 China Tourism Group Duty Free Corporation Limited(601888)
(1) the underperformance of 2021 is mainly affected by the impact of passenger flow under the epidemic and the impact of discount promotion on the profit margin. However, the profit margin is positively correlated with the overall passenger flow, which will be gradually improved in the future. The bargaining power of upstream brands will also help improve the profit margin, and some negative factors have been basically released;
(2) Haikou duty-free city is expected to open in the second half of 2022, and site 2 of Haitang Bay phase I is expected to open at the end of 2023. In the next two years, the overall property area of the company in Hainan will be improved, the carrying capacity and brand binding will be enhanced, and new brands and characteristic products will continue to enter;
(3) the company is still gradually accumulating its advantages in global competition, and its advantages over its main competitor, Han Mian, are still gradually enhanced, and the time for the complete liberalization of exit in the short term may be delayed, which is conducive to the continuous accumulation of advantages;
(4) during the 14th Five Year Plan period, the general trend of consumption return remains unchanged. The company has a strong development pattern and long-term industry growth space. It still plays a leading role in the competitiveness of the island and future core airports and ports. It is expected that the performance will still show a steady growth trend in recent years.
\u3000\u3000 22 Luzhou Laojiao Co.Ltd(000568)
1. The strategy of “holding high and fighting high” adopted by the company in recent years has been effective. Guojiao 1573 has established a market position in high-end wine, driving the rapid growth of the company’s overall performance and the continuous improvement of profit margin.
2, Luzhou Laojiao Co.Ltd(000568) as Baijiu famous old liquor, high-end liquor barrier is extremely strong, the national cellar + special song double line advance, the company rate will enter the fast lane of growth.
3. The implementation of the executive compensation management plan has significantly improved the degree of marketization compared with the previous one, which is conducive to binding the interests of shareholders, the company and management, and helping the company achieve long-term sustainable development.
\u3000\u3000 23 Hubei Feilihua Quartz Glass Co.Ltd(300395)
1. The company is a leading company of high-end quartz glass and products. The semiconductor and photovoltaic tracks downstream of civil products are in a high-speed growth trend. The localization rate will gradually increase during the 14th Five Year Plan period.
2. The company is a supplier of semiconductor consumables and raw materials certified by the three major international semiconductor equipment manufacturers. The company speeds up the promotion of high-end semiconductor products such as photomask substrates.
3. During the “14th five year plan” period, there is a strong demand in the aerospace field. As a major supplier of quartz glass fiber, the company will fully benefit.
\u3000\u3000 24 Zhejiang Jiaao Enprotech Stock Co.Ltd(603822)
1. Biodiesel can reduce PM2 5. Carbon dioxide and reduce the return of gutter oil to the dining table. Under the dual carbon background, there is a huge space for biodiesel. The global demand reaches 40 million tons and continues to grow. The company has a capacity of 50000 tons of biodiesel at the end of the year 20 and a new 250000 tons at the end of the year 21. In the future, there is a plan to expand production at the level of one million tons. At present, the net profit per ton is about 1000 yuan. A long-term purchase agreement has been signed with shell, resulting in strong demand, Under the release of production capacity, the performance flexibility is huge, and it is expected to become a leading enterprise of biomass diesel in the future.
2. The company is a leader in the environmental protection plasticizer industry. The price of products has increased this year, the environmental protection requirements will increase day by day in the future, and the environmental protection plasticizer business will maintain stable growth.
\u3000\u3000 25 Ningbo Jifeng Auto Parts Co.Ltd(603997)
1. The invisible champion of seat components is engaged in both internal and external repair, integration and expansion to achieve secondary growth: the internal company extends the depth of the industrial chain to the downstream passenger car seat assembly.
2. External integration: local assets in the same industrial chain are switched to overseas assets with high outsourcing rate, which has strong certainty and flexibility. M & A of grammer belongs to Chinese assets with high self-development and self-production rate in the same industrial chain, integrating overseas assets with high outsourcing rate, and the switching of supply system brings certainty to the integration. At present, grammer’s annual revenue volume is about 16 billion, and the 1PCT net interest rate increase corresponds to a profit elasticity of about 140 million.
3. New internal growth: the new business of passenger car seats has high track value and sustainable price increase. The pattern is good and has been broken through by orders from new forces. With grammer’s technology accumulation, rapid response and cost control capabilities, the company is expected to achieve domestic substitution and open a secondary growth curve.
China Securities Co.Ltd(601066) research review of gold stocks in January 2022
