Since 2021, the total output value of the construction industry has maintained a certain toughness. Under the goal of steady economic growth, active fiscal policy and moderately advanced infrastructure investment will play a certain role in stimulating infrastructure investment; Under the real estate regulation policy, real estate development investment is facing growth pressure. Under the influence of the above factors, the industrial structure adjustment of manufacturing industry, the urban renewal brought by the construction of new urbanization, the launch of projects such as the transformation of old cities and affordable housing, as well as the shortcomings of medical and other infrastructure will make up for the impact of the real estate policy on the real estate construction business to a certain extent, It is estimated that the total amount of new contracts signed by construction enterprises will continue to grow in 2022.
The expansion of large construction enterprises is accelerated, the liquidation of weak qualified enterprises is accelerated, and the differentiation of industry credit level is intensified; Under the double carbon constraint, enterprises that carry out green transformation in advance and have advantages in the field of new energy engineering construction are expected to occupy a favorable position in the competition; The listing of infrastructure public offering REITs has widened the financing channels of construction enterprises; Under the background of urban investment transformation, the demand for investment and financial construction projects will increase, and investment and financial construction modes such as abo may usher in new opportunities.
Construction enterprises are in a weak position in the industrial chain. The advance mode of operation is the norm of the industry. The pressure of downstream owners’ funds increases the advance of construction enterprises, prolongs the accounting period and increases the pressure of project payment collection, which puts forward higher requirements for the cash flow balance ability of construction enterprises and intensifies the project payment collection risk of construction enterprises.
Since 2020, the overall profitability, operation and cash acquisition level of construction enterprises have been stable, and the overall short-term debt repayment pressure of the industry is not large, but the anti risk ability of private enterprises is weak, or private construction enterprises will face the risk of tight liquidity, debt repayment and decline in profitability due to the influence of owners’ capital occupation. It is necessary to pay attention to the changes of debt repayment risk and credit level of relevant enterprises.
I. analysis ideas
The construction industry is one of the important industries in the national economy, with many market players and huge upstream and downstream industrial chains. This paper will analyze the credit fundamentals of the construction industry from three perspectives: at the macro level, analyze the prosperity and influencing factors of real estate development, infrastructure and manufacturing investment highly related to the output value of the construction industry in China’s fixed asset investment, Then judge the overall demand of the construction industry in the future; At the meso level, analyze the impact of changes in the industry competition pattern and relevant policies recently issued on the medium and long-term development of the construction industry; At the micro level, based on the above research, this paper further analyzes the profitability, payment collection, turnover efficiency and debt repayment indicators of the sample construction enterprises, and obtains the judgment of the overall credit level of the industry.
II. Industry fundamentals
Thanks to China’s effective epidemic prevention and control and economic restoration policies, the total output value of the construction industry has maintained a certain resilience since 2021; Under the goal of steady economic growth, active fiscal policy and moderately advanced infrastructure investment will play a certain role in stimulating infrastructure investment; At the same time, under the real estate regulation policy, the investment in real estate development is facing growth pressure. The industrial structure adjustment of manufacturing industry, the introduction of urban renewal, old city transformation and affordable housing brought by the construction of new urbanization, as well as the shortcomings of medical and other infrastructure will make up for the impact of the real estate policy on the real estate construction business to a certain extent, It is estimated that the total amount of new contracts signed by construction enterprises will continue to grow in 2022
The construction industry is an order driven industry, and its development is mainly affected by downstream demand. Benefiting from the continuous promotion of China’s urbanization construction and the continuous investment of the government in the fields of transportation, public facilities, water conservancy and environmental protection, the China State Construction Engineering Corporation Limited(601668) industry has maintained a good development trend over the years, with a compound annual growth rate of 6.34% of the total output value in the past five years (2015-2020). Specifically, in the past five years, the annual compound growth rate of the output value of the housing construction industry has been 6.90%, and the proportion in the total output value of the construction industry has decreased from 64.15% in 2015 to 61.33% in 2020. The annual compound growth rate of the output value of the civil engineering industry (railway, highway, municipal administration, industry and mining, etc.) has been 8.20%, and the proportion in the total output value of the construction industry has increased from 25.59% in 2015 to 28.55% in 2020, Industrial restructuring continued. From the perspective of new order guarantee coefficient 1, with the slowdown in the growth of China’s fixed asset investment, this index has fallen since reaching its peak in 2017. At the beginning of 2020, affected by covid-19 pneumonia, the growth rate of the total output value of the construction industry was negative. By early June, stimulated by the economic repair policy, the total output value of the construction industry had achieved positive growth, and the growth rate rose to a phased high in March 2021. In the first three quarters of 2021, China State Construction Engineering Corporation Limited(601668) achieved a total output value of 16.79 trillion yuan, a year-on-year increase of 13.94%, and completed a new contract amount of 21.94 trillion yuan, a year-on-year increase of 7.81%. The guarantee coefficient of new orders increased compared with 2020, and the guarantee capacity of total orders 2 was further enhanced. It can be seen that under the influence of economic restoration policies and low base, the total output value and order reserve of the construction industry have increased by a certain margin since 2021, but the growth rate showed a downward trend after April. In absolute terms, the order guarantee capacity of the construction industry is still at a good level, and the project side reserves are relatively rich, which can provide some support for the business development of construction enterprises in the future.
