1. The infrastructure industry chain is actively improving and is expected to continue to recover. In the context of China’s “steady growth”, the State Council’s policies continued to increase. This week, the national Standing Committee once again made it clear to “expand effective investment” and “stabilize market expectations”. At the same time, it was required to continue to do a good job in ensuring the supply and price of bulk commodities, alleviate the cost pressure of downstream enterprises, and the policy environment continued to improve. Orders in January have been accelerated. Represented by China State Construction Engineering Corporation Limited(601668) , new orders signed in January were 282.4 billion, with a year-on-year growth rate of 19.4%, of which the infrastructure sector reached a high growth rate of more than 68% year-on-year.
2. Concentrated construction was started in many regions across the country, the operating rate rebounded significantly, and the “good start” continued to be verified in the first quarter. As of this week, more than half of the construction sites in China have resumed work, which is relatively faster than that in the two weeks after last year’s holiday. At the same time, the cement operating rate has also been significantly improved, with a national month on month increase of nearly 7 percentage points. Against the background of uncertainty in the external environment, China’s economy is facing certain downward pressure. Expanding domestic demand and boosting infrastructure investment have become a strong starting point. Major projects have been intensively started and the physical workload has been accelerated. In addition, the issuance of special bonds earlier this year has enabled the implementation of multi-dimensional guarantee projects. It is suggested to pay attention to the investment opportunities of head infrastructure enterprises under the “stable growth”. The major projects of head enterprises are abundant and the degree of capital guarantee is high. Under the background of rushing to start construction, the force of orders and performance will be more significant.
Investment suggestion: under the influence of global uncertainties, the recovery trend of infrastructure investment is highly deterministic, and the leading enterprises in the subdivided industries have abundant orders and strong risk resistance. Investment opportunities for earthquake mitigation and isolation under high-quality development: long-term efforts have been made in disaster prevention and mitigation, legislation has been passed, and 20-30 times of space can be expected. Relevant targets such as Quakesafe Technologies Co.Ltd(300767) , Zhejiang Tiantie Industry Co.Ltd(300587) , the rail transit sector under the “transportation power” have long-term benefits: there is a broad demand for the construction of “Urban Agglomeration” on the track, and relevant targets such as Zhejiang Tiantie Industry Co.Ltd(300587) , China Railway Group Limited(601390) , China Railway Construction Corporation Limited(601186) ; Under the expectation of the improvement of China’s infrastructure investment margin in the second half of the year, it is suggested to pay attention to the opportunities related to the industrial chain: pay attention to the undervalued targets China State Construction Engineering Corporation Limited(601668) , China Railway Construction Corporation Limited(601186) , China Railway Group Limited(601390) ; Leading infrastructure enterprises with steady main business and mineral resources: Metallurgical Corporation Of China Ltd(601618) , China Railway Group Limited(601390) ; Under the background of dual control of energy consumption, high-quality targets in green power, BIPV and other related fields: Sinosteel Engineering & Technology Co.Ltd(000928) , Power Construction Corporation Of China Ltd(Powerchina Ltd)(601669) , Sinoma International Engineering Co.Ltd(600970) .
