Today (February 25), the three major A-share stock indexes opened higher. After the shock consolidation at the beginning of the session, the stock index rose again and gradually weakened. The pattern of Shanghai weak and Shenzhen strong was obvious.
On the disk, the general rising market reappeared, the industry and concept sectors were almost “red”, only gold, gas and other sectors faced a correction, the rise of steel, rare earth permanent magnet and other targets, the relevant sectors of the pharmaceutical industry chain took the lead, the eastern digital computing, consumer electronics and other sectors also performed prominently, and the local profit-making effect soared.
Caitong Securities Co.Ltd(601108) indicates that it is recommended to see more and move less, and balance the configuration. During the policy expectation period of China’s two sessions, the verification period of economic data, the landing period of the Federal Reserve’s interest rate discussion in March and the fermentation period of Russia Ukraine conflict, the overall market has many disturbing factors, repeated emotions and large fluctuations.
At present, under the background of scattered A-share hotspots and intensified sector rotation, possible investment opportunities are hidden. Select some institutional research reports. Let’s see what themes are available for reference.
[Theme 2] steel
China Merchants Securities Co.Ltd(600999) said that it is recommended that investors pay attention to investment opportunities in cyclical industries such as steel and construction. Steel may be the protagonist in the second stage of the market. In particular, it is recommended to pay attention to the sub industries of the real estate completion chain, such as decoration and architectural design. The large amount provision of most companies should have been completed and is expected to be light loaded; Looking ahead, the concentration of the real estate industry is expected to increase rapidly, and relevant sub industries and companies are also expected to break away from the extreme point of extremely poor fundamentals and enter a new round of stable growth. At the same time, it is suggested to continue to pay attention to the extension and expansion of central enterprises and state-owned enterprises in new fields (such as Power Construction Corporation Of China Ltd(Powerchina Ltd)(601669) to clean energy). Their investment logic is different from that of sub industries in the real estate chain. They have their own long-term investment logic.
Huaan Securities Co.Ltd(600909) believes that the recovery of manufacturing demand superimposes the background of carbon peak and carbon neutralization, the profit logic of the steel industry can be reconstructed, and the steel enterprises further benefit from the cyclical rotation. We are still optimistic about the steel sector for a long time. The national defense, military industry and aerospace industry have a broad domestic substitution space, and products such as superalloy, special stainless steel and ultra-high strength steel occupy an absolute dominant position. It is suggested to focus on the performance of the interim report and the special steel leader who can fulfill the high-profile of the industry: Fushun Special Steel Co.Ltd(600399) ; Traditional field leaders + popular emerging business targets are more favored by the market. It is suggested to focus on stainless steel rods and wires and mica lithium extraction leaders: Yongxing Special Materials Technology Co.Ltd(002756) ; And the high growth leader in the field of cold rolled stainless steel: Zhejiang Yongjin Metal Technology Co.Ltd(603995) .
Soochow Securities Co.Ltd(601555) pointed out that under the background of historically high profits and historically low valuations, the carbon neutralization probability has brought the supply ceiling of the industry. In addition, the raw material side has contributed cost dividends again, and the steel stocks will usher in a wave of sector opportunities for double rise in performance and valuation. []
[subject II ] rare earth permanent magnet
East Asia Qianhai Securities pointed out that from the situation in recent three years, the current inventory of praseodymium and neodymium oxide is only at the quantile level of 9.9% in recent three years. Under the tight balance of supply and demand, rare earth prices are expected to continue to rise in the future. In the short term, although the rare earth mining and smelting index has increased in 2022, it is difficult to expand the output in a large amount in a short time, and the tight supply side is difficult to be effectively alleviated. In the long run, under the dual carbon policy, the rapid development of emerging fields such as wind power and new energy vehicles will lead to a strong demand for rare earths in the future. Under the tight balance of supply and demand, rare earth prices still have upward momentum.
Guotai Junan Securities Co.Ltd(601211) mentioned that the downstream of rare earth is mainly permanent magnet materials and catalysts, accounting for 29% and 20% respectively. Since 2021, due to the rapid increase in the acceptance of new energy vehicle products, the global penetration of new energy vehicles has increased rapidly, driving the demand for permanent magnet materials. Under the background of carbon neutralization, the increase of wind power installed capacity will also support the demand for permanent magnet materials, and the high boom of rare earth industry will continue.
Previously, The Pacific Securities Co.Ltd(601099) Securities said that in the next three years, the probability of rare earth is the healthiest variety in the upstream supply and demand pattern of new energy. After experiencing the price rise caused by the demand explosion in 2020-2021, the upstream and midstream of the new energy vehicle industry chain have entered the production expansion cycle. Only the supply of rare earth is difficult to effectively improve. From the perspective of resources, the overseas supply (Mount pass in the United States, Lynas in Australia and Myanmar mine) has reached its peak, and it is difficult to see a clear production expansion path at present; In China, the black rare earth disappeared, and the production quotas were all in the two major groups ( China Northern Rare Earth (Group) High-Tech Co.Ltd(600111) and the newly established China rare earth group). From the indicators issued before the festival, the overall growth rate was relatively restrained, with a year-on-year growth rate of 20%. With the passage of time, the healthy supply and demand pattern of rare earth stands out from the rest. Unlike other varieties, it is deteriorating. Time will be a friend of the rare earth sector. This is the new logic of the rare earth sector. The sustainable time of the healthy supply and demand pattern is far beyond market expectations. []
[subject III ] medical devices
Great Wall Guorui Securities pointed out that the valuation is at the bottom of history and the current investment value of the pharmaceutical industry is prominent. It is suggested to increase the allocation proportion of the industry and pay attention to investment opportunities in six aspects: first, the performance disclosure of the annual report in 2021 and the first quarterly report in 2022 is imminent, and pay attention to the high-quality targets with high growth or higher than expected performance of the annual report and the first quarterly report; Second, with the official release of the 14th five year plan for the development of pharmaceutical industry, under the premise of controlling medical insurance expenses, innovation and internationalization will be the core main line of the industry in the future. It is suggested to pay attention to innovation driven companies and pharmaceutical enterprises with international ability; Third, the CXO industry. Recently, the CXO industry has undergone in-depth adjustment, and the valuation is at the bottom of history. Contrarian, focus on companies with sufficient orders and reasonable current valuation; Fourth, drugstore chain companies with reasonable valuation and stable recovery; Fifth, pay attention to the consumer medical section. Under the background of medical insurance fee control, the ophthalmology, medical beauty and other medical sub industries with consumption attribute have policy immunity, and the consumption upgrading will drive their development; Sixth, pay attention to the traditional Chinese medicine sector. The release of the guiding opinions on medical insurance supporting the inheritance, innovation and development of traditional Chinese medicine shows the state’s determination to the inheritance, innovation and development of traditional Chinese medicine, which will play a positive role in the traditional Chinese medicine industry.
Guosheng Securities said that medicine has entered the medium and long-term layout range, and the medium and short term is still bottom-up, with more emphasis on the three factors of “performance valuation chips”. Up to now, the “double high problem” has been digested. Although there are many assets with unspeakable short-term valuation, extremely cheap and short-term concerns that are difficult to prove false, they have entered the allocation range in the medium and long term. In the short and medium term, in fact, there is no systematic solution. Recently, there have been problems in the chip structure of the whole market. Our idea is still to select individual stocks from bottom to top. There are three points to sum up: 1) select individual stocks with “fundamental common sense valuation oversold and discount”, in other words, they have fallen to the second-order derivative of the irrational valuation range. 2) The sub areas of “domestic demand policy immunity” and “foreign demand is relatively rigid” are selected to take into account the comprehensive and sudden impact of the current geopolitical environment and medical policy environment, especially the emotional impact.
Such as adult class II vaccine, self-control, China covid-19 therapeutic drug industry chain, traditional Chinese medicine, rehabilitation, cdmo, etc. 3) Due to the high degree of chaos in stage trading, the chip factor should be fully considered when bottom reading.
Huaan Securities Co.Ltd(600909) mentioned that considering the background of the pharmaceutical industry, on the one hand, the uncertainty caused by the continuous promotion of the centralized purchase policy this year (centralized purchase of consumables, national purchase, alliance purchase, etc.), on the other hand, the short-term pharmaceutical industry sector has not seen clear favorable policies / changes, and there is no upward momentum in the short term. It is advisable to look at the quantity of scenery. The valuation of many pharmaceutical companies has reached a very reasonable range. The uncertainty of changes brought by policies makes many investors unable to start. We suggest the direction configuration of this year: Traditional Chinese medicine (policy friendly + undervalued value) + medical equipment (medical infrastructure) + scientific research reagents and upstream + other directions to find the target from bottom to top. []
[theme 4] East number and West calculation
Donghai securities mentioned that the project of “counting from the east to the west” was officially launched. “Counting from the east to the west” project belongs to digital infrastructure construction, that is, new infrastructure construction. The construction of computing hub and data center cluster will expand the effective investment in upstream and downstream industrial chains and help the economy achieve steady growth. The data center industrial chain includes not only traditional civil engineering, but also it equipment manufacturing, information and communication, basic software, green energy supply, etc., which may boost the relevant industrial chains in the future.
Citic Securities Company Limited(600030) believes that the East digital West computing project is expected to drive the overall improvement of computing power demand in the central and western regions, and the key benefits of the communication industry chain. It is expected to drive the development of data centers and related upstream and downstream industries and expand industrial investment through the layout of 8 computing hubs and the formation of data center clusters across the country. We are optimistic about the demand drive of the East digital West computing project for IDC, ICT equipment, optical modules, operators, temperature control equipment, optical communication and other fields.
As the core base of the East digital West computing project, the communication sector is expected to benefit mainly: 1) operators: the advantages of cloud network integration and cloud edge combination of operators are prominent. Operators have a large-scale computing power layout in the central and western regions, and the public cloud and edge cloud are also growing rapidly, which is expected to continuously improve the operating efficiency. It is suggested to pay attention to China Mobile, China Telecom Corporation Limited(601728) , China United Network Communications Limited(600050) ;
2) temperature control equipment: green energy-saving development of data center + stricter pue control is expected to continue to promote the demand for temperature control equipment. It is recommended to pay attention to Shenzhen Envicool Technology Co.Ltd(002837) , Nanjing Canatal Data-Centre Environmental Tech Co.Ltd(603912) ;
3) ICT equipment & optical module: ICT equipment and optical module are the basis of computing power network. The construction of data center cluster + the increasing demand for computing power is expected to promote the expansion and upgrading of servers, switches, routers and optical modules. It is recommended to pay attention to Unisplendour Corporation Limited(000938) , Zte Corporation(000063) , Zhongji Innolight Co.Ltd(300308) , Eoptolink Technology Inc.Ltd(300502) , Suzhou Tfc Optical Communication Co.Ltd(300394) ;
4) optical communication: the explosion of data traffic is expected to accelerate the promotion of optical fiber communication to all-optical network. It is optimistic that the centralized procurement volume and price of optical fiber and optical cable of operators will rise together to promote the high-quality growth of the industry. It is recommended to pay attention to Jiangsu Zhongtian Technology Co.Ltd(600522) , Hengtong Optic-Electric Co.Ltd(600487) , Yangtze Optical Fibre And Cable Joint Stock Limited Company(601869) ;
5) IDC: under the policy environment of counting from the east to the west, the energy consumption indicators of first tier cities are becoming stricter. The advantages of IDC leaders with strong foundation and in-depth cooperation with Internet and cloud manufacturers in and around first tier cities continue to highlight. It is suggested to pay attention to Shanghai Baosight Software Co.Ltd(600845) , Beijing Sinnet Technology Co.Ltd(300383) , Guangdong Aofei Data Technology Co.Ltd(300738) , Kehua Data Co.Ltd(002335) .
In addition, Guolian Securities Co.Ltd(601456) pointed out that the “East digital West computing” project will focus on supporting innovative contents such as green data center (green energy conservation, renewable energy and energy storage), efficient scheduling of computing power (Cloud Computing), and controllable innovation of computing power (domestic basic software and hardware, cloud platform, big data analysis). The project of “counting from the east to the west” will drive the demand opportunities of data center operation and civil engineering, it equipment manufacturing, information and communication, basic software and green energy supply in the industrial chain. []
