This round of high-quality growth track has long adjustment time, deep range and full risk release
From January 30, 2021 to the closing on February 22, 2022, the CSI 300 index fell 2.23% and the CS machinery index fell 10.97% in the same period. As a high-quality growth track in the mechanical sector, the adjustment range of the track sector is much larger than that of the mechanical sector. Taking the six growth tracks of machinery industry represented by semiconductor equipment, photovoltaic equipment, laser processing equipment, lithium battery equipment, 3C equipment and industry Siasun Robot&Automation Co.Ltd(300024) as an example, in our statistical range, CITIC semiconductor equipment, photovoltaic equipment, laser processing equipment, lithium battery equipment, 3C equipment and industry Siasun Robot&Automation Co.Ltd(300024) fell by 27.97%, 26.46%, 24.77%, 23.36% and 20.06% respectively 10.48%, which is far worse than CITIC machinery industry and CSI 300 index. After nearly three months of deep and drastic adjustment, the risk of high valuation of growth track has been fully released, and the investment value has been highlighted.
The adjustment range of high-quality stocks in the growth track is deep, the valuation has reached a reasonable range, and the investment cost performance is high. After three months of substantial adjustment, the sector index of six representative growth tracks in CITIC machinery industry has generally fallen by more than 20%, of which the decline of high-quality leading targets is more than 20%. We still take the time period of industry adjustment as the statistical interval and the consistent expectation of wind as the reference data, and select excellent listed companies in photovoltaic equipment, lithium battery equipment and semiconductor equipment for comparative analysis. It is found that:
1) with Zhejiang Jingsheng Mechanical & Electrical Co.Ltd(300316) , Suzhou Maxwell Technologies Co.Ltd(300751) as the leader, the average adjustment range of 8 high-quality photovoltaic equipment listed companies in this round is 23.7%, of which the adjustment range of Yingkou Jinchen Machinery Co.Ltd(603396) , Shenzhen S.C New Energy Technology Corporation(300724) , Wuxi Shangji Automation Co.Ltd(603185) is more than 30% or even more than 40%. The average PE of 8 high-quality photovoltaic equipment listed companies in 2022 is 35.25x, and the average compound growth rate in the next two years is 51.56%. According to the valuation in 2022, peg is 0.80, far lower than 1. Among them, the average compound growth rate of five listed companies in pure photovoltaic equipment in the next two years is 38.03%, and the average peg in 2022 is 1.09; The average compound growth rate of the three listed companies from photovoltaic equipment to downstream silicon wafers in the next two years is 74.12%, and the average peg in 2022 is 0.32, which makes the investment cost-effective better.
2) the average adjustment range of the eight lithium battery equipment listed companies led by Wuxi Lead Intelligent Equipment Co.Ltd(300450) was 25.57%, of which the adjustment ranges of Zhejiang Hangke Technology Incorporated Company(688006) , Shenzhen Hymson Laser Intelligent Equipments Co.Ltd(688559) , Shenzhen United Winners Laser Co.Ltd(688518) , China National Electric Apparatus Research Institute Co.Ltd(688128) were more than 30%. The average PE of 8 listed companies of high-quality lithium battery equipment was 32.1x in 2022, the average compound growth rate in the next two years was 82.74%, and the average peg in 2022 was 0.41. Among them, Shenzhen Hymson Laser Intelligent Equipments Co.Ltd(688559) , Shenzhen United Winners Laser Co.Ltd(688518) and other listed companies, the peg in 2022 is lower than 0.3.
3) the average adjustment range of 8 semiconductor equipment listed companies led by Naura Technology Group Co.Ltd(002371) and Advanced Micro-Fabrication Equipment Inc.China(688012) is 20.99%, the average PE in 2022 is 64.07x, the average compound growth rate in the next two years is 42.21%, and the average peg in 2022 is 1.71. The valuation and peg are close to the bottom range of semiconductor equipment.
The three growth tracks are still one of the most definite and highest growth directions of the machinery industry. They continue to be optimistic about lithium battery equipment in the medium and long term: the demand for new energy vehicles exploded in 2021, and the annual cumulative sales of new energy vehicles were 3.52 million, an increase of 1.6 times year-on-year, exceeding the expected 1.8 million of the association, and the output of power batteries reached 219.7gwh, an increase of 1.7 times year-on-year. 2021 is a year of substantial expansion of power battery main engine factory. The head and second and third tier power battery manufacturers have increased investment to expand production capacity, and the order demand for lithium battery equipment is very strong. 2022 is the last year of subsidies for new energy vehicles. The stability of policy subsidies, coupled with the significant increase in Chinese consumers’ recognition of new energy vehicles, will drive the total sales of medium Shanxi Guoxin Energy Corporation Limited(600617) vehicles to soar in 2022. The passenger Federation predicts that the sales volume of new energy vehicles is expected to exceed 6 million in 2022, with a year-on-year increase of more than 70%. China Automobile Association predicts that the sales volume of new energy vehicles will be 5 million in 2022. This year is still expected to be the new year of new energy vehicles, and lithium battery equipment enterprises do not worry about order demand. According to the “big data of China’s lithium battery production equipment industry” released by Gaogong lithium, the planned capacity of global power batteries will reach 550gwh in 2021, and the planned capacity of energy storage and other fields will reach 80gwh and 120gwh respectively. It is predicted that the global planned production capacity will reach 1twh in 2022, and most of the production capacity will be concentrated in China. It is predicted that the scale of China’s lithium battery equipment market will increase to nearly 80 billion yuan in 2022, an increase of more than 50% year-on-year in 2021.
Photovoltaic equipment: China Photovoltaic Industry Association disclosed that the global photovoltaic installed capacity in 2021 was 170gw, a year-on-year increase of 33.85%, of which China’s photovoltaic installed capacity in 2021 was 54.88gwh, a year-on-year increase of 13.9%. It is estimated that the global PV installed capacity will be 195-220gw in 2022, and the new PV installed capacity in China will be 75-90gw, with a year-on-year increase of 36.66% – 63.99%. Last year, due to the shortage of upstream silicon production capacity, the sharp rise in silicon price led to the rise in prices in all links of the industrial chain, which dragged down the demand for new installed capacity. In 2022, with the new production capacity of silicon material put into operation, the cost of photovoltaic links is expected to be reduced, and the installed capacity of photovoltaic will usher in rapid growth. This year is undoubtedly a photovoltaic year, benefiting the whole industry chain.
Semiconductor equipment: TSMC again raised its capital expenditure in 2022 from US $14.9 billion in 2019 to US $30 billion in 2021. This year (2022) will reach US $40 billion to US $44 billion, of which about 70% to 80% will be used for advanced processes of 2 nm, 3 nm, 5 nm and 7 nm; About 10% is used for advanced packaging and mask fabrication; About 10% to 20% are used for special processes. As the industry leader, TSMC continues to increase capital expenditure and drive the industry to open a new round of production expansion, which is conducive to the continuous recovery of the demand for semiconductor equipment. This year, the semiconductor equipment industry is still expected to maintain high growth. In addition, affected by the epidemic, the global chip shortage has not been alleviated, resulting in more and more supply interruptions and factory shutdowns. At present, chip production and supply have become the strategic focus of European countries and the United States. European countries, China and other manufacturing powers are re increasing investment in the chip field to ensure their own semiconductor supply chain security. This industrial trend also brings medium and long-term sustainable demand to the semiconductor equipment industry.
Cherish the bottom range and grasp the investment opportunity of oversold rebound
We believe that after a long time of in-depth adjustment, the leader of the high-quality growth track has returned to the attractive valuation range, the risk is fully released, the industry growth is determined, the growth rate remains at a high level, and has a strong investment cost performance. Cherish the bottom range of high-quality growth track leaders and grasp the investment opportunity of oversold rebound.
Oversold rebound concerns:
Photovoltaic equipment: focus on the absolute leader of monocrystalline silicon growth furnace, the Zhejiang Jingsheng Mechanical & Electrical Co.Ltd(300316) layout of silicon carbide substrate, the downstream silicon wafer production and slicing services from photovoltaic equipment. This year, the production capacity will gradually release Wuxi Shangji Automation Co.Ltd(603185) , Qingdao Gaoce Technology Co.Ltd(688556) with significant profit growth. It is suggested to pay attention to Shenzhen S.C New Energy Technology Corporation(300724) , Suzhou Maxwell Technologies Co.Ltd(300751) , Yingkou Jinchen Machinery Co.Ltd(603396) with serious oversold.
Lithium battery equipment: focus on the lithium battery equipment leader Wuxi Lead Intelligent Equipment Co.Ltd(300450) with full orders. It is recommended to pay attention to Zhejiang Hangke Technology Incorporated Company(688006) , Shenzhen Hymson Laser Intelligent Equipments Co.Ltd(688559) , Shenzhen United Winners Laser Co.Ltd(688518) with serious oversold.
Semiconductor equipment: focus on the comprehensive leader Naura Technology Group Co.Ltd(002371) of semiconductor equipment production line. It is recommended to pay attention to the undervalued targets Pnc Process Systems Co.Ltd(603690) , Beijing Huafeng Test & Control Technology Co.Ltd(688200) , Shanghai Gentech Co.Ltd(688596) and the seriously oversold Advanced Micro-Fabrication Equipment Inc.China(688012) and shengmei Shanghai.
Risk tips: 1: macroeconomic growth is less than expected; 2: Export demand is lower than expected; 3: Industry competition intensifies; 4: The price of raw materials continues to rise; 5: Abnormal changes in industrial policies.
