Key investment points
Key events of this week: 1) accelerated issuance of local bonds and steady growth: in January, the issuance of local bonds nationwide increased by 583.7 billion yuan, an increase of 221.4 billion yuan over the same period last year, including 99.3/484 billion yuan of general bonds / special bonds. 2) Increase the promotion of prefabricated buildings: the Ministry of housing and urban rural development’s “14th five year plan” for the development of construction industry clearly stipulates that prefabricated buildings account for more than 30% of new buildings during the 14th Five Year Plan period. 3) The decline in the performance of the brand building materials sector is mainly due to impairment, and the impairment risk may have been fully released: Skshu Paint Co.Ltd(603737) / Asia Cuanon Technology (Shanghai) Co.Ltd(603378) it is predicted that the net profit loss attributable to the parent company in 21 years will be 320 ~ 470 million / 440 ~ 580 million; D&O Home Collection Co.Ltd(002798) / Jiangsu Canlon Building Materials Co.Ltd(300715) / Guangdong Dongpeng Holdings Co.Ltd(003012) the forecast realized the net profit attributable to the parent company of 270 ~ 370 million / 60 ~ 90 million / 30 ~ 50 million, with a year-on-year decrease of 34.9% ~ 52.0% / 67.7 ~ 77.4% / 94.0% ~ 96.0%. Among them, Skshu Paint Co.Ltd(603737) the bad debt provision is expected to be 650-850 million in 21 years; Asia Cuanon Technology (Shanghai) Co.Ltd(603378) it is estimated that a single impairment of 599 million will be withdrawn for several real estate customers; Guangdong Dongpeng Holdings Co.Ltd(003012) it is estimated that the corresponding impairment will be accrued for 798 million receivables of real estate customers; Jiangsu Canlon Building Materials Co.Ltd(300715) it is estimated that the corresponding impairment will be accrued for 189 million receivables of Evergrande group. 4) The profit of glass / glass fiber increased rapidly, and the performance of cement leaders decreased slightly: Zhuzhou Kibing Group Co.Ltd(601636) / Csg Holding Co.Ltd(000012) it is predicted that the net profit attributable to the parent company in the 21st year will be 4.04-4.47 billion / 1.29-1.63 billion, with a year-on-year increase of 121.4% ~ 144.7% / 66% ~ 109%; Sinoma Science & Technology Co.Ltd(002080) the forecast realized a net profit attributable to the parent company of RMB 3.26 ~ 3.88 billion, with a year-on-year increase of 60% ~ 90%; The high performance growth is mainly due to the high prosperity of glass fiber in 21 years. Xinjiang Tianshan Cement Co.Ltd(000877) the forecast realized a net profit attributable to the parent company of 12-13.8 billion, a year-on-year decrease of 7.6% ~ 6.3% compared with the retroactive adjustment after the reorganization of the previous year. The overall performance is that the price increases, the volume decreases slightly and the cost rises.
This week, we believe that we still attach importance to the short-term growth of infrastructure chain. In terms of infrastructure, the implementation of projects / special bonds has been accelerated. Under the current economic pressure, the role of infrastructure investment may be more prominent, and the rhythm has been further advanced (the special bonds in January increased by 221.4 billion compared with the same period last year). We pay attention to the investment opportunities of industries with high proportion of infrastructure such as cement, water reducing agent, pipe and waterproof. The investment opportunities of brand building materials and new materials are promising throughout the year. In terms of real estate, policy marginal relaxation + increased demand, affordable housing with non real estate developers as the main body, and the demand of the real estate chain is expected to gradually pick up. In terms of brand building materials, some companies have announced their performance for 21 years, and their profits have declined significantly. We judge that 21q4 is still affected by the impairment of receivables from real estate customers. With the further provision of impairment, we judge that the impairment risk of brand building materials may have been fully released. We believe that the expected bottom of the real estate corresponds to the bottom of the valuation of brand building materials (refer to the resumption in 2014 / 18). The double repair of the performance and valuation of brand building materials in 22 years is worth looking forward to. The layout of brand building materials has high certainty. In the field of new materials, carbon fiber / high-purity quartz sand / electronic cover glass ushered in the industrial opportunity of high demand + domestic alternative resonance, and UTG welcomed the outbreak of demand. The glass fiber cycle weakened, the roving boom is expected to continue, and the price center of electronic cloth fell. The price toughness of float glass still exists; Photovoltaic glass may have price elasticity at the bottom of the cycle. Cement industry integration + extension; Water reducing agent opens up growth space for functional materials.
Before the Spring Festival, the cement price center remained high. After the festival, the advance development of infrastructure investment and the expected improvement of real estate are expected to support demand, and the role of policy regulation of coal price has been reflected, and the cost pressure of enterprises is expected to be relieved. We continue to be optimistic about the valuation and repair opportunities of cement sector. In the last week before the Spring Festival, the national cement market price remained stable. At the end of January, due to the approaching of the long Spring Festival holiday, the demand of China’s cement market entered the stage of phased market closure. The shipment volume of enterprises in most regions was only 1-30%, and the cement price was generally stable. After filling the cement inventory, local cement enterprises successively carried out off peak production or kiln shutdown for maintenance. The national storage capacity ratio was 62.2%, with a month on month ratio of + 0.9pct and a year-on-year ratio of + 8.5pct; The shipment rate was 11.6%, with a chain comparison of -22.6pct and a year-on-year comparison of -21.0pct. 21q4 has gradually played a role in the regulation of the “price limit + production increase” combination policy of coal. Enterprises actively carry out peak shifting production, which promotes the 21q4 price center to maintain a high level, and the cost pressure has been alleviated month on month. Looking forward to the next 22 years, although the overall demand for real estate may be under pressure, the margin has improved. With the steady growth, the infrastructure end is expected to become the starting point, and the overall demand toughness will remain; In addition, the coal price has fallen from a high level, and the profit toughness of enterprises is expected to be maintained. We are still optimistic about the further repair of the sector. It is recommended to focus on Huaxin Cement Co.Ltd(600801) , Anhui Conch Cement Company Limited(600585) , Xinjiang Tianshan Cement Co.Ltd(000877) , Guangdong Tapai Group Co.Ltd(002233) , and it is recommended to focus on Gansu Shangfeng Cement Co.Ltd(000672) , China building materials, Jiangxi Wannianqing Cement Co.Ltd(000789) .
Continue to focus on recommending China’s concrete water reducing agent industry leader Sobute New Materials Co.Ltd(603916) . Sobute New Materials Co.Ltd(603916) recommendation logic: the company’s production capacity planning is clear, which is expected to continue to grow in the next three years and the market share will continue to increase; The price of ethylene oxide, a raw material, dropped rapidly. At the end of September, the price increase of the company was gradually implemented, and the profitability is expected to improve; The company’s functional materials (such as anti crack and anti-seepage agent, wind power grouting material, etc.) maintain a high growth, and is expected to grow into an admixture platform enterprise.
Brand building materials: the corresponding valuation at the end of expectation is low, and b-end brand building materials enterprises welcome light packaging. 1) Since 21q4, “bottom of real estate policy + broad real estate market (affordable housing)” + landing of credit risk + stabilization and decline of raw material prices, and the expected bottom of brand building materials has been established. 2) From the 14-year and 18-year recovery, the expected bottom of the real estate corresponds to the bottom of the valuation of brand building materials. 3) Leading enterprises have enhanced their competitiveness and highlighted their growth (category expansion and application expansion) during the pressure period of the industry. They hope to meet the resonance of performance and valuation in 22 years. Leading enterprises are ahead of other enterprises α On the one hand, the factor is reflected in the anti risk ability of the downturn, on the other hand, it is more vulnerable to factor addition when positive variables appear. Leading enterprises of brand building materials have advantages in terms of brand / Channel / cost / capital. They have the ability to cross the cycle in terms of competitiveness and growth. They are the first to stand out from the encirclement in the process of building the bottom, seize the leading position and actively layout the leaders. We recommend Beijing New Building Materials Public Limited Company(000786) , Beijing Oriental Yuhong Waterproof Technology Co.Ltd(002271) , Guangdong Kinlong Hardware Products Co.Ltd(002791) , Keshun Waterproof Technologies Co.Ltd(300737) , Yonggao Co.Ltd(002641) , Monalisa Group Co.Ltd(002918) , Zhejiang Weixing New Building Materials Co.Ltd(002372) , Skshu Paint Co.Ltd(603737) , Guangdong Dongpeng Holdings Co.Ltd(003012) Wangli Security & Surveillance Product Co.Ltd(605268) , Asia Cuanon Technology (Shanghai) Co.Ltd(603378) , it is suggested to pay attention to China Liansu, Jiangsu Canlon Building Materials Co.Ltd(300715) , D&O Home Collection Co.Ltd(002798) .
New material field: 1) carbon fiber boom continues: the average price of carbon fiber market at the weekend of the last week before the Spring Festival is 187000 yuan / ton (flat month on month, year-on-year + 4.7), the average price of large tow is 147000 yuan / ton (flat month on month, year-on-year + 2.2), and the average price of small tow is 225000 yuan / ton (flat month on month, year-on-year + 7.0); At the weekend, the inventory of carbon fiber factory was 1 ton (Mom-1, yoy-14).
The raw material acrylonitrile market operated weakly and stably, and the price of precursor remained high. We believe that the investment logic of the civil carbon fiber industry lies not only in the high demand growth (wind, light, hydrogen, etc.), but also in the “favorable climate, favorable location and harmonious people”. After seizing the opportunity to catch up, we will further expand the scale and cost advantage and realize the historical opportunity of “domestic substitution” and transcendence. Under the barriers of high technology, technology and capital, those who win the “raw silk” win the world. In the medium and long term, with reference to glass fiber, the industry penetration can be improved or rely on “price” for “demand”. We suggest paying attention to the carbon fiber leader Zhongfu Shenying (to be listed), Weihai Guangwei Composites Co.Ltd(300699) , precursor leader Jilin Carbon Valley, Jilin Chemical Fibre Co.Ltd(000420) , Sinofibers Technology Co.Ltd(300777) , and Hengshen shares; Carbon fiber equipment manufacturer Zhejiang Jinggong Science & Technology Co.Ltd(002006) ; Downstream composite manufacturers Sinoma Science & Technology Co.Ltd(002080) , Kbc Corporation Ltd(688598) , Beijing Tianyishangjia New Material Corp.Ltd(688033) , Hongfa new materials, etc. 2) For the quartz glass industry, benefiting from the growth of photovoltaic installed capacity / the transformation of photovoltaic cells from p-type to n-type, the demand for high-purity quartz sand is growing rapidly, the supply side is newly added or limited, and the supply and demand is expected to maintain a tight balance; The demand for semiconductors and military quartz materials is booming, and the barriers to qualification certification are high. Leading enterprises are expected to continue to increase the market share, and Jiangsu Pacific Quartz Co.Ltd(603688) and Hubei Feilihua Quartz Glass Co.Ltd(300395) are recommended. 3) Electronic cover glass: Chinese enterprises have achieved a technological breakthrough and passed the downstream certification. Under the condition of improving the penetration rate of domestic mobile phones and ensuring the safety of the supply chain, domestic substitution is accelerated. It is recommended to pay attention to CSG a, which has achieved the iterative breakthrough of electronic cover technology and completed the verification of downstream mobile phone manufacturers. 4) UTG: the penetration acceleration of folding screen mobile phones + alternative CPI trend is obvious, and the demand welcomes the outbreak; Take the lead in realizing technological breakthrough and benefiting mass production enterprises. It is suggested to pay attention to Triumph Science & Technology Co.Ltd(600552) of UTG mass production and shipment.
Glass fiber: the industry cycle is weakened and the boom is expected to continue. In the last week before the Spring Festival, the average price of 2400tex winding direct yarn was 6133 yuan / ton (the same month on month, year-on-year + 467); The average price of electronic yarn G75 is 12250 yuan / ton (unchanged month on month, year-on-year + 1150); The mainstream quotation of electronic cloth is 5.3 yuan / meter (flat month on month). We expect that the new capacity of the industry will be limited in 22 years, with roving / electronic yarn of about 42 / 100000 tons respectively. In addition, the production line is put into operation more dispersed. We expect the marginal new capacity of 22q1-22q4 to be 1.7/1.7/3.3/13000 tons / quarter respectively, with a relatively mild impact. We expect that the global effective production capacity / demand of glass fiber in 22 years will be 9.36/9.43 million tons respectively. The supply and demand are in tight balance. Under the low inventory, the price boom is expected to continue. The energy cost of glass fiber accounts for about 20%, and the energy consumption is still high. Under the dual control of energy consumption, it is more difficult to increase the new capacity of the industry, and the uncertainty of landing rhythm increases. We believe that the new production capacity will still be dominated by leading enterprises, and the industry pattern is expected to continue to be optimized. The leader has core competitiveness such as cost and technology, and the continuous upgrading of product structure will hedge the periodicity to a certain extent. The competitiveness of the leader in the glass fiber industry is significantly enhanced whether from the perspective of increasing market share or continuous decline in cost. We expect that the profit of the bottom leader in the next round is expected to increase significantly compared with history. We continue to focus on recommending the glass fiber leader China Jushi Co.Ltd(600176) . We also recommend Sinoma Science & Technology Co.Ltd(002080) (diaphragm price starts the upward cycle, wind power is expected to hit the bottom and rise, glass fiber profit is expected to exceed expectations, and continue to be optimistic about the future growth sustainability of the three sectors), Jiangsu Changhai Composite Materials Co.Ltd(300196) (capacity expansion planning is clear, growth is gradually realized, and the industrial chain integration has strong ability to resist risks), Shandong Fiberglass Group Co.Ltd(605006) .
The price of building glass is at the bottom of the stage; Photovoltaic glass may have price elasticity at the bottom of the cycle. The average price of float glass at the weekend of the last week before the Spring Festival is 2099 yuan / ton (mom + 33, yoy – 69); At the weekend, the inventory was 35.1 million heavy containers (Mom – 48, yoy + 1344); The production capacity of glass in production is 174975t / D (unchanged month on month). The overall shipment of photovoltaic glass market is acceptable, and the mainstream price is mainly implemented. At present, the inventory pressure of most glass manufacturers is controllable, and they are expected to be better in the future. We believe that under the “guaranteed delivery” of real estate, the toughness of glass demand is expected to be maintained. On the supply side, considering the high capacity utilization rate of the industry, the subsequent new capacity is limited; In addition, at present, in the production line, the production capacity with kiln age of 8-10 years / more than 10 years accounts for 14.1% / 14.5% respectively. The cold repair of the old production line may lead to supply contraction. At present, the price and cost of glass are close. Under the high cost of raw materials / energy, manufacturers are willing to support the price, and the price of glass is expected to continue to pick up. In terms of photovoltaic glass, the mainstream quotation of 3.2mm coating on the weekend of the last week before the Spring Festival is 25 yuan / Ping (the same month on month, year-on-year – 41%); Inventory days 21.32 days (Mom – 8%, yoy + 269%); The production capacity is 41210t / D (Mom – 2%, yoy + 37%). For photovoltaic glass, under the dual control of energy consumption, the new supply may be less than expected, and the price at the bottom of the industrial cycle may be upward elastic. Optimistic about the revenue proportion of traditional glass enterprises in the field of photovoltaic glass and improve their cost competitiveness. Continue to focus on Zhuzhou Kibing Group Co.Ltd(601636) and suggest paying attention to CSG a, Xinyi Glass, Luoyang Glass Company Limited(600876) .
Risk warning: macroeconomic downside risk; Demand is lower than expected; Excessive new capacity; Poor capital turnover.
