Key investment points
Steel: the amplitude of steel price and iron ore price increased this week. On the surface, the NDRC frequently expressed its position to curb iron ore speculation, which hit the market sentiment, but in fact, most industrial products other than steel and iron ore also experienced shock correction. We are not sure whether there has been a short-term rebound in the price of industrial products since November, but we are not sure whether there has been a small rebound in the price of industrial products since November. This round of rebound was triggered by the overshoot recovery of the inventory cycle of the industrial chain and the repair of real demand in the early stage. After entering the off-season in January and February, the continued rise of prices was driven by the expectation of steady growth. At present, the demand of the iron and steel industry is still in the off-season, and the high-frequency data can not reflect the demand. The effect of steady growth can not be verified until mid March. Therefore, the steady growth expectation can not be verified before mid March, and the commodity market is still likely to continue trading the logic of steady growth. Another noteworthy factor is that the standardization of Finance and taxation in the scrap industry chain may lead to the rise of scrap cost and the contraction of scrap supply. This impact may be clearly reflected from February to March, which is a supporting factor for the short-term black price. From a longer time perspective, we believe that this round of price rebound since November belongs to the phased repair in the large downward demand cycle. After the steady growth pulse, we must be careful about the second half of the downward demand cycle, and the time node of demand turn may be in spring. Short term steady growth transactions can focus on Hbis Resources Co.Ltd(000923) , and growth-oriented new materials can focus on Zhejiang Yongjin Metal Technology Co.Ltd(603995) , Zhangjiagang Guangda Special Material Co.Ltd(688186) , Zhejiang Jiuli Hi-Tech Metals Co.Ltd(002318) , Yongxing Special Materials Technology Co.Ltd(002756) , Fushun Special Steel Co.Ltd(600399) .
Coal: the stability of profit expectation is improved. It is suggested to actively layout coal stocks in 2022. In terms of thermal coal: the supply recovered slowly after the festival, and the demand level was higher than that in previous years. This week, the price of 5500 kcal thermal coal produced in QinGang Shanxi was 1010 yuan / ton, unchanged on a week-on-week basis. In terms of supply, after the Spring Festival holiday, the coal mines in the main producing areas resumed work slowly. After the price limit meeting of the national development and Reform Commission, some coal mines lowered coal prices, but the coal supply in the market is still tight; Due to the impact of environmental protection inspection and epidemic prevention and control, it will take time to restore transportation capacity. In terms of import, bidding has been conducted for coastal power plants recently, but the bidding has not been settled yet. At present, the external price is high. Although there are inquiries from downstream power plants, there are few transactions and more wait-and-see. In terms of demand, affected by low-temperature weather such as rain and snow, the power generation load of Nanfang power plant is high, and the demand level is higher than that in previous years. At present, the supply basically meets the daily consumption demand; In the case of slow recovery of upstream supply, the demand for downstream chemical industry and coking is more positive. However, after the price limit policy, there is a strong wait-and-see mood in the downstream, and the inventory will be replenished after the price stabilizes. On the whole, the coal supply showed a tight trend this week. Follow up attention will be paid to the resumption of production and price reduction of coal mines in the origin and the recovery of terminal demand. In terms of coking coal, both supply and demand are weak, mainly stable. As of February 11, the price (tax included) of Shanxi main coke coal depot in Jingtang Port was raised by 2830 yuan / ton, unchanged month on month. In terms of supply, after the festival, the resumption of production of coal mines in the main producing area of coking coal has made rapid progress, and most of them have resumed normal production. According to Fenwei statistics, the raw coal output of the coal mine in this period increased by 594600 tons to 8956200 tons month on month. In terms of import, the epidemic situation in Mongolia has rebounded recently. Ganqi Maodu port was closed for 4 days during the Spring Festival, and customs clearance was resumed on February 5. The port was cleared for 4 days this week, with an average of 76 vehicles per day (week on week – 13 vehicles). The customs clearance of Mongolian coal continues to operate at a low level, with few marketable resources. At the same time, the demand of China’s coking coal market has weakened, and the wait-and-see mood is strong. In terms of demand, the downstream coke enterprises have poor profitability, poor enthusiasm for raw coal procurement, more digestion of early-stage inventory, traders are also mainly on the sidelines, and the demand side is weak as a whole. On the whole, the coking coal market continues the pattern of weak supply and demand, and pays attention to the changes in the profitability of downstream coke enterprises. In terms of coke, both supply and demand shrink, and maintain stable operation after price reduction. As of February 11, the price of secondary metallurgical coke in Tangshan was 2800 yuan / ton, down 400 yuan / ton on a weekly basis, and the national average profit per ton of coke was about – 84 yuan / ton. In terms of supply, the coke market operated stably after two rounds of price reduction. Affected by environmental protection inspection restrictions and profit inversion, the operating rate of coke enterprises decreased. In terms of demand, due to the impact of the Winter Olympic Games, the downstream steel mills have increased their efforts to limit production, the maintenance of blast furnace is still increasing, and the steel mills have delayed procurement. At present, most of them are consumption inventory. On the whole, both ends of coke supply and demand have shrunk. Although the production restriction of steel mills is stronger than that of coke enterprises, considering that coke enterprises have generally suffered losses, it is expected to maintain stable operation after two rounds of price reduction, and pay attention to the inventory changes of coke enterprises in the future. Investment strategy: steady growth at the policy level, relaxed coal consumption indicators and favorable demand expansion; The policy recognizes medium and high coal prices and improves the expectation of medium and long-term profit stability of the industry. All the above are conducive to the improvement of sector valuation. At the market level, the demand expands under the background of steady growth, while the guaranteed supply capacity is expected to withdraw after the peak season, the industry margin is tightened, and the coal price is expected to run strongly. Overseas coal prices have soared and imported coal prices have been seriously inverted. Stock capacity is a scarce resource. Coal stocks are generally valued at 5-6 times, and the stability of price and profit expectation is improved. It is suggested to actively layout coal stocks in 2022. According to the recommendation idea of individual stocks, the performance growth of companies with high proportion of long-term association is more stable, and the valuation of companies with high proportion of coal in the market is more attractive. Thermal coal stocks are suggested to pay attention to: Shaanxi Coal Industry Company Limited(601225) , Yanzhou Coal Mining Company Limited(600188) , China Shenhua Energy Company Limited(601088) , China Coal Energy Company Limited(601898) , power investment and energy, Beijing Haohua Energy Resource Co.Ltd(601101) . Metallurgical coal stocks are suggested to pay attention to: Shanxi Lu’An Environmental Energydev.Co.Ltd(601699) , Pingdingshan Tianan Coal Mining Co.Ltd(601666) , Shanxi Coking Coal Energy Group Co.Ltd(000983) , Huaibei Mining Holdings Co.Ltd(600985) , Jizhong Energy Resources Co.Ltd(000937) , Shanxi Coking Co.Ltd(600740) . Anthracite recommended attention: Shanxi Lanhua Sci-Tech Venture Co.Ltd(600123) . Coke stocks are suggested to pay attention to: Shanxi Meijin Energy Co.Ltd(000723) , Jinneng Science&Technology Co.Ltd(603113) , China Xuyang group, Kailuan Energy Chemical Co.Ltd(600997) , Shaanxi Heimao Coking Co.Ltd(601015) .
Nonferrous Metals: China’s steady growth will continue, and the relative income of industrial products will continue. 1) The upward trend of raw material prices in the upstream of new energy has been continuously strengthened. In January, the sales volume of electric vehicles in Europe increased year-on-year and weakened seasonally: the sales volume of six European countries (Britain, France, Germany, Norway, Sweden and Italy) totaled 108600 vehicles in January, with a year-on-year increase of 27% and a month-on-month decrease of 47%. The price of lithium carbonate has accelerated upward again. This week, the price of battery grade lithium carbonate has increased by 1.41% compared with last week, and the price of battery grade lithium hydroxide has increased by 1.31%. Pilbara expects the long-term single price of 22q1 lithium concentrate to reach 2600-3000 US dollars / ton. With the tightening of raw materials, the price of cobalt may rise further. The quotations of MB cobalt (standard grade) and MB cobalt (alloy grade) increased by 1.02% and 0.87% month on month respectively, and the prices of metal cobalt and cobalt sulfate in China increased by 2.6% and 3.2% respectively. The pattern of rare earth permanent magnet industry was reshaped, the spot market and the downstream actively inquired for orders after the festival. The quotation of praseodymium and neodymium oxide in China rose by 8.7% to 1.035 million yuan / ton; In terms of medium and heavy rare earths, the prices of dysprosium oxide and terbium oxide increased by 0.7% and 3.5% respectively. China Northern Rare Earth (Group) High-Tech Co.Ltd(600111) in February, the listing price of praseodymium and neodymium oxide was 816000 yuan / ton, down 0900 yuan / ton month on month. Nickel: low inventory, nickel price rebounded. After the festival, some enterprises have not returned to work, and the inventory of nickel raw materials in China is low. SHFE nickel closed at 173700 yuan / ton, up 1.70% month on month.
2) Precious metals, geopolitical tensions and inflation risks enhance the attractiveness of safe haven assets. On the one hand, driven by geopolitical uncertainty in Russia and Ukraine, risk aversion promoted the continued rise of gold; On the other hand, concerns about the continued rise in US consumer prices have further enhanced the position of gold as an inflation hedging tool. As of February 11, Comex gold closed at US $1842.1/oz, up 1.90% month on month; COMEX silver closed at US $23.369/oz, up 3.98% month on month. 3) For base metals, China’s “steady growth” is clear, and the relative return of the sector will continue. China’s capital is expected to be fully relaxed, and the policy direction of steady growth is very clear. In addition, enterprises return to work after the festival, and downstream demand increases slowly; Overseas, investors’ concerns about low global inventories increased, but driven by high inflation data, the market’s expectation of the Fed’s interest rate hike in March increased, limiting the rise of base metals. Specifically, LME copper, aluminum, lead, zinc, tin and nickel rose or fell by – 0.5%, 3.6%, 3.5%, 1.1%, 1.6% and 1.4% respectively this week, and the price rose as a whole. 4) Investment strategy: base metals, base metals. China’s economic work in 2022 is set to be “stable”. Social finance greatly exceeded expectations in January. It is expected that the follow-up stable growth policy will be gradually introduced to support the confidence of base metal demand. However, globally, the changes in the structure of overseas economic demand before, during and after the epidemic and the tightening trend of overseas liquidity remain unchanged, Still suppressing demand for base metals. The upstream raw materials of new energy, such as lithium cobalt, rare earth, copper foil, aluminum foil and magnetic materials, are still strong in the short cycle, and the general direction of the medium and long-term three-year boom upward cycle will not change. The industrial boom is the most clear and firmly optimistic.
Building materials: Social Finance and special bonds have made a good start, and continue to recommend the target of stable growth chain; The marginal recovery of real estate and the opportunity of brand building materials throughout the year are worth looking forward to. The growth rate of social finance is higher than expected, the implementation of projects / special bonds is accelerated, and the capital construction is expected to grow steadily. Attention is paid to investment opportunities in industries with high proportion of capital construction such as cement, water reducer, pipe and waterproof. 1) Under the expectation of stable growth in the short term and rising temperature, the excess return of the cement sector is prominent, the industry has high prosperity toughness in 22 years, and industrial integration + extension in the medium and long term. 2) From the perspective of water reducing agent, capital construction pull + gross profit margin rise + functional materials open up growth space. 3) The price of float glass rose strongly. We judged that it was mainly due to the release of replenishment demand from downstream traders. In the future, with the continuation of demand toughness, the price is expected to remain relatively flexible; The bottom of photovoltaic glass is recommended to be flexible and bring long-term profit growth to the traditional photovoltaic glass field. 4) 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. 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, and the leading certainty is high. 5) 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. 6) The glass fiber cycle weakened, the roving boom is expected to continue, and the price center of electronic cloth fell.
Chemical industry: the price of crude oil has reached a new high, the global capital expenditure has warmed up, and the leaders in the oil service industry have fully benefited: China Oilfield Services Limited(601808) ; The rise of oil prices has driven the increase and expansion of chemical products prices, among which private large-scale refining has fully benefited: Rongsheng Petro Chemical Co.Ltd(002493) , Hengli Petrochemical Co.Ltd(600346) , Jiangsu Eastern Shenghong Co.Ltd(000301) , Hengyi Petrochemical Co.Ltd(000703) , while the relevant industrial chain represented by PTA polyester filament is expected to be driven by cost demand: Tongkun Group Co.Ltd(601233) , Xinfengming Group Co.Ltd(603225) .
The traditional bulk is still looking for the bottom, and the leading value crosses the cycle. As the main body of the chemical industry, the PPI of chemical raw materials and chemical products manufacturing industry in December 2021 increased by 23.8% year-on-year, which was positive for 12 consecutive months. In terms of downstream demand, from January to December 2021, the newly started area of houses decreased by 11.4% year-on-year, 0.04% month on month in December, the construction area increased by 5.2% year-on-year from January to December, 6.32% month on month in December, the completed area increased by 11.2% year-on-year from January to December, and 184.9% month on month in December; From January to December, the national automobile output increased by 4.8% year-on-year; From January to December, the retail sales of clothing, shoes, hats, knitwear and textiles increased by 14.2% year-on-year, with strong demand. On the supply side, the investment in fixed assets in the chemical industry continued to grow. From January to December, the investment in fixed assets in chemical raw materials and chemical products manufacturing industry increased by 15.7% year-on-year. It is suggested to pay attention to leading enterprises with excellent quality and core competitiveness, such as Wanhua Chemical Group Co.Ltd(600309) , Shandong Hualu-Hengsheng Chemical Co.Ltd(600426) , Jiangsu Yangnong Chemical Co.Ltd(600486) , Zhejiang Nhu Company Ltd(002001) , Rongsheng Petro Chemical Co.Ltd(002493) , Tongkun Group Co.Ltd(601233) , Hengli Petrochemical Co.Ltd(600346) . With the improvement of health awareness, sugar substitutes have become the general trend of the times. It is suggested to pay attention to the leading food additives Anhui Jinhe Industrial Co.Ltd(002597) in the business cycle. New materials: actively embrace industrial innovation and supply chain reconstruction. Scientific and technological progress promotes the innovation of terminal demand and drives the upgrading and development of high-end manufacturing industry. In this process, industrial innovation will put forward higher requirements for material properties and promote the rapid development of new material industry. It is suggested to pay attention to the targets of industrial innovation and supply chain reconstruction: Jiangsu Yoke Technology Co.Ltd(002409) , Shandong Sinocera Functional Material Co.Ltd(300285) , Valiant Co.Ltd(002643) . In addition, it is suggested to focus on high-quality growth companies: Zhejiang Hailide New Material Co.Ltd(002206) .
Risk warning event: the sharp decline of macro economy leads to pressure on demand; The pressure at the supply end continues to increase. The economic growth rate is lower than expected; Excessive policy regulation; Renewable energy substitution, etc; Risk of coal import impact. Macroeconomic fluctuation, import, environmental protection and other policy fluctuation risks, gold price fluctuation risks, new energy vehicle sales are lower than expected risks, and the premise assumptions of industry supply and demand calculation are lower than expected risks; Macroeconomic downside risk; Demand is lower than expected; Excessive new capacity; Poor capital turnover. Macroeconomic downside risk, crude oil price fluctuation risk and enterprise operation risk.
