Key events of this week: 1) the commencement of major projects is expected to be accelerated: Zhao Chenxin, Secretary General of the national development and Reform Commission, recently said that the preliminary work of major projects and projects in the 14th five year plan should be strengthened to start construction as soon as possible and form physical workload as soon as possible. 2) Photovoltaic glass leaders acquire mineral resources and deepen strategic reserves of raw materials: Flat Glass Group Co.Ltd(601865) it is planned to acquire 100% equity of Dahua / Sanli mining with a total price of 3.34 billion, of which Dahua / Sanli mining is going through the production expansion procedures to change the production scale to 2.6/4 million tons / year. 3) Shandong Fiberglass Group Co.Ltd(605006) the expected increase in performance is in line with the expectation: the company predicts to achieve revenue / net profit attributable to parent company of 2.75/550 billion in 21 years, yoy + 37.7% / + 216.8%, in line with the expectation.
This week’s view: “steady growth” is expected. After the next + 15th day of the first month, demand is expected to recover gradually. The recent continuous rise in cement / glass prices has made a good start. Cement clinker along the river has increased for two rounds, with a total of 60 yuan / ton. Glass benefited from the replenishment of inventory by processors and traders. The price rose strongly (week on week + 228 yuan / ton) and the inventory decreased rapidly (month on month – 5.32 million heavy containers). The commencement of major projects on the infrastructure side / issuance of special bonds has been accelerated, the policy on the real estate side continues to improve, and the demand is expected to start gradually. 1) In the short term, when the cement industry is expected to grow steadily and heat up, the excess return of the sector is prominent. In the 22 years, the industry has high prosperity toughness (focusing on the enhancement of supply side coordination), and in the medium and long term, the industry is expected to be integrated + extended. 2) From the perspective of water reducing agent, capital construction pull + gross profit margin rise + functional materials open up growth space. 3) Float glass prices rose strongly, mainly due to the release of replenishment demand from downstream traders. In the follow-up, with the continuation of demand toughness, the price is expected to maintain good elasticity; Photovoltaic glass may have price elasticity at the bottom of the cycle. It is recommended to focus on the profit elasticity and long-term growth brought by the expansion of traditional glass into the field of photovoltaic glass. This week, we released an in-depth report on the photovoltaic glass industry, “the leader will expand again against the trend and wait for the bottom of the industry to rise”. We believe that the industry has both cycle and growth. In 22 years, under the influence of the bottom of the cycle / energy consumption, the new supply of the industry may be lower than expected, and the demand side is expected to continue to improve. Without excluding the periodic mismatch between supply and demand, the price has upward elasticity; Optimistic about the expansion of leading enterprises against the trend and cost competitiveness. 4) Brand building materials enter the strategic allocation time point. In terms of real estate, policy marginal relaxation + increased demand for 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 (the end of real estate demand is expected to correspond to 2022q1). 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, and this round corresponds to 2021q4). The double repair of the performance and valuation of brand building materials in 22 years is worth looking forward to. The leaders of each subdivision track have long interpreted the main logic of improving the concentration. The frequent repurchase, incentive and increase of industrial funds highlight the confidence of enterprises and have channels, brands Enterprises with excellent endowments such as capital and management have high certainty. 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) Glass fiber cycle weakened, roving boom is expected to continue (wind power, automobile and other strong support for demand), and the price center of electronic cloth fell.
Under the expected warming of steady growth, the cost performance of cement sector allocation is prominent. Through the resumption of trading, we found that the cement sector can achieve about 10% excess return in each round of stable growth policy setting and data window period. The economic data verification period showed a volatile trend, and the fundamentals verification period was highly related to performance. At present, it is an important layout time point after setting the tone of steady growth. The cement sector is expected to continue to benefit from the expected warming. In addition, the fundamentals will also have better support to determine its continuity: we believe that although there is a small single digit decline in demand in 22 years, it is expected to remain at a high platform period of more than 2 billion tons. Under the contraction of demand, the willingness of enterprise supply coordination is expected to increase, and the coal price center is expected to move down compared with 2021. Industry integration will accelerate the optimization of pattern, and leading enterprises will actively layout aggregate Commercial and mixed markets contribute to growth, and the cost performance is prominent under the low valuation. This week, the national cement market price fell by 0.3% month on month. In mid February, due to the repeated influence of off-season factors, rain and snow weather and epidemic situation in some areas, the downstream demand started slowly, the shipment of enterprises recovered only about 20%, and the cement price in some areas fluctuated and adjusted slightly. After the Spring Festival, the downstream demand recovered slowly, within expectations. On the one hand, the demand performance was weak in the fourth quarter of last year, the return of funds from the mixing plant was poor, and the enthusiasm for construction was low; On the other hand, the government has increased the investment in infrastructure, which reflects the lag in the pull of cement demand. The cement demand in the opening market is mainly continuous projects. In addition, the point recurrence of the epidemic also restricts the return of workers in some areas. On February 15, the clinker price along the Yangtze River Delta increased for the second time, with a range of 30 yuan / ton. It is expected that the cement price in some areas will rise steadily. According to comprehensive judgment, the downstream demand will increase significantly at the end of February and early March, and the market will fully recover in the middle and early March. The national storage capacity ratio was 66.8%, month on month + 0.2pct, year-on-year + 4.1pct; The shipment rate was 14.6%, with a month on month increase of + 10.5pct and a year-on-year increase of -9.0pct. It is recommended to focus on Huaxin Cement Co.Ltd(600801) , Anhui Conch Cement Company Limited(600585) , Guangdong Tapai Group Co.Ltd(002233) , and it is recommended to focus on Gansu Shangfeng Cement Co.Ltd(000672) , China building materials, Xinjiang Tianshan Cement Co.Ltd(000877) , 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 raw material ethylene oxide is running at a low level. At the end of September, the price increase of the company is gradually implemented, and the gross profit margin in 22 years may increase significantly; 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.
Building glass downstream replenishment to promote price strength; Photovoltaic glass may have price elasticity at the bottom of the cycle. At the weekend of this week, the average price of float glass was 2399 yuan / ton (mom + 228, yoy + 309); Weekend inventory of 38.1 million heavy containers (Mom – 532, yoy – 720); The production capacity of glass in production is 174375t / D (unchanged month on month). This week, the market price of float glass in China has increased significantly, and it is still dominated by the demand for goods. The inventory of float factory continues to be reduced, and the social inventory is gradually high. It is expected that the mainstream of the market will operate stably, the inventory of most float factories is low, and there is still a possibility of slow rise and small rise. 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 at the end of this week is 25 yuan / square (the same month on month, year-on-year – 40%); Inventory days: 24.1 days (mom + 0.8%); The production capacity in process is 42210t / D (mom + 2%, yoy + 28%). For photovoltaic glass, the new supply under the dual control of energy consumption 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 Holding Co.Ltd(000012) , Shandong Jinjing Science And Technology Stock Co.Ltd(600586) , Xinyi Glass, Luoyang Glass Company Limited(600876) .
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 strengthened their competitiveness and highlighted their growth (category expansion and application expansion) during the pressure period of the industry. The credit impairment of major enterprises has been implemented in 21 years, and the performance and valuation are expected to be restored in 22 years. 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) , ad shares, 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 materials: 1) carbon fiber boom continues: at the end of this week, the average price of carbon fiber market was 187000 yuan / ton (flat month on month, year-on-year + 4.7), the average price of large tow was 147000 yuan / ton (flat month on month, year-on-year + 2.2), and the average price of small tow was 225000 yuan / ton (flat month on month, year-on-year + 7.0); At the weekend, the inventory of carbon fiber factory was 13 tons (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 the iterative breakthrough of electronic cover technology and complete the Csg Holding Co.Ltd(000012) verified by 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. This week, the average price of 2400tex winding direct yarn was 6100 yuan / ton (unchanged month on month, year-on-year + 367); The average price of electronic yarn G75 is 11250 yuan / ton (unchanged month on month, year-on-year + 1600); The mainstream quotation of electronic cloth is 4.5 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, and the production line will be 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 glass fiber leaders China Jushi Co.Ltd(600176) , Sinoma Science & Technology Co.Ltd(002080) Jiangsu Changhai Composite Materials Co.Ltd(300196) (clear capacity expansion planning, gradual realization of growth, strong anti risk ability of industrial chain integration), Shandong Fiberglass Group Co.Ltd(605006) .
Risk warning: macroeconomic downside risk; Demand is lower than expected; Excessive new capacity; Poor capital turnover.
