Core view
Policies have been issued one after another to fully promote carbon peak in various fields. Recently, the Ministry of industry and information technology issued the “14th five year” industrial green development plan, which puts forward the overall implementation path of “focusing on one action, building two systems, promoting six transformations and implementing eight projects” for the strategic task of efficient, green, circular and low-carbon development of China’s manufacturing industry. In the future, China will promote the green transformation of industry in terms of low-carbon energy consumption, recycling of resource utilization, greening of production process and so on.
Cement prices fell and glass prices rose. With the cold weather, the northern region began to implement the staggered peak kiln shutdown plan in the heating season. At the same time, the demand in the southern region was lower than that in the same period of previous years, and the downward demand led to the decline of cement price. With the fall of coal prices, the cement coal price difference fell month on month, the profitability of the industry fell slightly month on month, and the year-on-year increase narrowed. Float glass spot prices continued to rise this week. Due to the rush demand, the inventory of float glass enterprises in some areas decreased, but the overall inventory is still on the high side. In terms of cost, the price of soda ash has declined to a certain extent, and the price of fuel has decreased. The profits of float glass industry increased steadily.
Inventory decline narrowed, and the current round of demand may be coming to an end. This week, the steel price was strong, showing a trend of weak differentiation between long and strong plates, the gross profit per ton of steel increased significantly, and the profitability of steel mills rebounded sharply. In terms of supply, except for the slight decline of thread this week, the output of five major steel products rebounded month on month; In terms of demand, weekly consumption rebounded slightly month on month and the growth rate decreased significantly; In terms of inventory, the total inventory contracted slightly month on month, and the decline of factory inventory was greater than that of social inventory. On the raw material side, iron ore turned from strong to weak this week, coke continued to stabilize and scrap steel was strong. In terms of demand, with the gradual warehousing of resources in transit from Beicai to the south, the rigid demand will mainly digest its own inventory, and the procurement enthusiasm may decline.
Further promote the energy revolution and accelerate the construction of an energy power. The central economic work conference mentioned that the gradual withdrawal of traditional energy should be based on the safe and reliable substitution of new energy. Based on the basic national conditions of coal, we should pay attention to the clean and efficient utilization of coal, increase the consumption capacity of new energy, and promote the optimal combination of coal and new energy. To ensure energy supply, large enterprises, especially state-owned enterprises, should take the lead in ensuring supply and stable prices. We believe that before the cultivation of energy storage technology is mature and the stability of new energy is improved, we cannot de coal too quickly. Although it will control the new production capacity and output, the intensity will be moderate. The supply of traditional energy is more important for the stable operation of economy, and the constraints on traditional energy are expected to be eased.
Investment suggestions: environmental protection and public utilities: it is recommended to pay attention to China Power (2380. HK), Huaneng Power International Inc(600011) (600011. SH), Longyuan Power (0916. HK), China Three Gorges Renewables (Group) Co.Ltd(600905) (600905. SH), Henan Bccy Environmental Energy Co.Ltd(300614) (300614. SZ), Beijing Geoenviron Engineering & Technology Inc(603588) (603588. SH), Zhefu Holding Group Co.Ltd(002266) (002266. SZ), Shandong Intco Recycling Resources Co.Ltd(688087) (688087. SH). Building materials: recommended Guangdong Kinlong Hardware Products Co.Ltd(002791) (002791. SZ), Beijing New Building Materials Public Limited Company(000786) (000786. SZ), Beijing Oriental Yuhong Waterproof Technology Co.Ltd(002271) (002271. SZ) Keshun Waterproof Technologies Co.Ltd(300737) (300737. SZ), Zhejiang Weixing New Building Materials Co.Ltd(002372) (002372. SZ), Zhuzhou Kibing Group Co.Ltd(601636) (601636. SH), China Jushi Co.Ltd(600176) (600176. SH). Steel: recommended Baoshan Iron & Steel Co.Ltd(600019) (600019. SH), Hunan Valin Steel Co.Ltd(000932) (000932. SZ), Yongxing Special Materials Technology Co.Ltd(002756) (002756. Sz), Fushun Special Steel Co.Ltd(600399) (600399. SH), Citic Pacific Special Steel Group Co.Ltd(000708) (000708. SZ). Coal: recommended China Shenhua Energy Company Limited(601088) (601088. SH), Shaanxi Coal Industry Company Limited(601225) (601225. SH), Shanxi Coking Coal Energy Group Co.Ltd(000983) (000983. SZ), Shanxi Meijin Energy Co.Ltd(000723) （000723）、 Shan Xi Hua Yang Group New Energy Co.Ltd(600348) （600348）。
Risk warning: the risk of sharp fluctuations in raw material prices; The risk that the downstream demand is less than expected, and the landing effect of production restriction is less than expected; The risk that the policy strength is less than expected; The risk that the new capacity of the industry exceeds the expectation; The risk of sharp decline in coal prices under the pressure of policy regulation.
