The steady growth policy has injected a booster into the non-ferrous metal industry. Under the signal of the central bank’s easing of the real estate investment policy or the implementation of the domestic policy of the Central Committee, the direction of interest rate reduction should be released moderately, and the central bank’s monetary infrastructure policy should be released ahead of schedule. With the support of steady growth, terminal demand expansion and liquidity, non-ferrous metal consumption is expected to increase marginally. Overseas, the hawkish information of the Federal Reserve at the interest rate meeting in January is gradually digested by the market. In Europe, under the influence of the “Russia Ukraine incident”, the energy crisis is becoming more and more serious, or it may increase the restriction on the operating rate of non-ferrous metal smelting capacity in Europe and further affect the global non-ferrous metal supply. With the support of many positive factors from macro liquidity to industry fundamentals outside China, the prosperity of non-ferrous metal industry is expected to continue to rise.
Investment suggestion: under the guidance of China’s steady growth policy, the central bank’s interest rate cut will release the positive signal of wide currency and wide credit. The national development and Reform Commission has made it clear that it is necessary to speed up the introduction and implementation of strategic policies and measures to expand domestic demand. Steady growth policies and measures such as advanced infrastructure investment are expected to be intensively introduced after the Spring Festival, which is conducive to boosting the demand expectation of industrial metals. The ultra hawkish monetary tightening expectation released by the Federal Reserve at the interest rate meeting in January has also been gradually digested by the market, which is conducive to reducing the pressure of the US dollar on the price of bulk commodities and non-ferrous metals. Driven by China’s steady growth, the industrial metal sector is expected to see improvements in consumption, price and profit. It is suggested to pay attention to the investment opportunities of leading industrial metal enterprises such as copper, aluminum and zinc under the theme of steady growth, and recommend Zijin Mining Group Company Limited(601899) (601899), Tongling Nonferrous Metals Group Co.Ltd(000630) (000630), Yunnan Aluminium Co.Ltd(000807) (000807), Henan Shenhuo Coal&Power Co.Ltd(000933) (000933), Tianshan Aluminum Group Co.Ltd(002532) (002532). The new energy vehicle industry chain continued to be hot. In mid January, Shanxi Guoxin Energy Corporation Limited(600617) car sales won a good start, Byd Company Limited(002594) and new car manufacturing forces such as Xiaopeng, ideal and Weilai, as well as overseas Europe and the United States, the sales of new energy vehicles in January increased significantly year-on-year. The demand of downstream terminals is strong, the fundamental outlook of lithium and cobalt industries in the upstream of the industrial chain is high, and the metal price continues to rise with strong certainty. According to the performance forecast of 2021 annual report released by Zhejiang Huayou Cobalt Co.Ltd(603799) , Ganfeng Lithium Co.Ltd(002460) and other new energy metal leaders, the performance of the upstream resource sector of the new energy automobile industrial chain has been significantly higher than expected since 21q4. We are still optimistic about the investment opportunities in the cobalt lithium rare earth sector. In 2022, the industry boom is still hot, and the continuous rise of prices makes the performance of the sector highly deterministic. Superimposed on the correction of early stock prices, the current valuation and investment cost performance of cobalt lithium leading enterprises is high. It is suggested to pay attention to notes Ganfeng Lithium Co.Ltd(002460) (002460), Zhejiang Huayou Cobalt Co.Ltd(603799) (603799), Tianqi Lithium Corporation(002466) (002466), Yongxing Special Materials Technology Co.Ltd(002756) (002756), Sinomine Resource Group Co.Ltd(002738) (002738) Keda Industrial Group Co.Ltd(600499) （600499）。 The Ministry of industry and information technology issued the first batch of rare earth mining, smelting and separation indicators in 2022, with an increase of 20% compared with the first batch of indicators in 2021. The increment is mainly concentrated in light rare earths, and the mining indicators of medium and heavy rare earths remain unchanged. The first batch of rare earth mining and smelting indicators in 2021 account for about half of the annual indicators. If the first batch of rare earth mining and smelting indicators in 2022 are still half of the annual indicators according to the promulgation rhythm of production quotas in 2021, it is expected that the tight pattern of supply and demand in 2022 will continue. With the strong demand for new energy in the downstream and the rising demand for replenishment in the industrial chain, and the output of Myanmar mine and NdFeB waste in the upstream fell to the shortage of rare earth oxide supply, it is expected that the price of rare earth will still maintain the expectation of strong rise in the early stage after the Spring Festival. Near the two sessions, the rare earth policy is expected to further catalyze the rare earth sector market. It is suggested to pay attention to the increment of young rare earth quota in 2022, mainly focusing on China Northern Rare Earth (Group) High-Tech Co.Ltd(600111) (600111), Inner Mongolia Baotou Steel Union Co.Ltd(600010) (600010) under China Northern Rare Earth (Group) High-Tech Co.Ltd(600111) group and China Minmetals Rare Earth Co.Ltd(000831) (002738), the only listing platform of China rare earth group, a central rare earth enterprise of China. In addition, it is suggested to pay attention to other rare earth enterprises Rising Nonferrous Metals Share Co.Ltd(600259) (600259), Shenghe Resources Holding Co.Ltd(600392) (600392), Xiamen Tungsten Co.Ltd(600549) (600549) with the expectation of continued industry integration.
