The central economic work conference (hereinafter referred to as the "conference") concluded on December 10, 2021 made it clear that "next year's economic work should be stable and seek progress while maintaining stability, all regions and departments should shoulder the responsibility of stabilizing the macro economy, all parties should actively launch policies conducive to economic stability, and the policy force should be appropriately advanced" 。 Combined with the overall thinking, policy arrangements and work priorities of the central government's comprehensive deployment of economic work next year, our grasp of speculative opportunities in the machinery manufacturing sector is mainly divided into three directions:
1. The general direction of achieving the "double carbon goal" and promoting energy transformation remains unchanged, and the good scenery is still "beautiful". On the whole, the "meeting" proposed to be firm
The keynote of seeking progress in stability, standing first and breaking later, and playing steadily and steadily, clearly puts forward that it is impossible to achieve carbon peak and carbon neutralization in one battle. It is a policy correction for China's sports carbon reduction and carbon reduction, "one size fits all" reduction of coal, and the general direction of promoting energy transformation has not changed. "Stand first and then break" means that the construction of reliable and stable new energy supply comes first, and the orderly withdrawal of fossil energy comes later. Vigorously developing clean energy represented by photovoltaic, wind power and lithium power is the premise to accelerate the elimination and substitution of fossil energy. Lithium battery equipment, photovoltaic equipment and wind power equipment are special equipment for new energy track. The bottom logic is interlinked. The core is to grasp the overall installed capacity of downstream and the rhythm of production expansion of corresponding customers. During the "14th five year plan" period, they are expected to exceed expectations and actively embrace Davis's double blows under the high boom.
2. Under the background of macro-control and policy disclosure, the construction machinery sector is expected to realize "value return" early next year. The "meeting" proposed that infrastructure investment should be carried out moderately in advance, fiscal policy and monetary policy should be coordinated and linked, and cross cyclical and counter cyclical macro-control policies should be organically combined. The construction machinery sector is now on the left side of the fundamentals. In 2021, the sector fluctuated greatly under the dual pressure of demand side and cost side, and the valuation and profit were revised down to a certain extent. Looking forward to next year, taking excavator as an example, the annual growth rate in 2022 is expected to be negative, but the decline is narrowed quarter by quarter. Under the neutral expectation, the growth rate of Q1-Q4 in 2022 is expected to be - 16%, 1%, 5% and 27% respectively. The industry inflection point is expected to appear in Q2 next year. We believe that the "dark period" of the sector has passed. The leading construction machinery enterprises that underestimate the value have experienced the test of the downward period of the industry. There is no doubt about their competitiveness and have medium and long-term allocation value. It is expected to realize the value return early next year under the catalysis of policies.
3. Cultivate the core competitiveness of the manufacturing industry, and "specialization and innovation" opens new opportunities for gold mining in the manufacturing industry. The "meeting" proposed to enhance the core competitiveness of the manufacturing industry, start a number of industrial infrastructure reconstruction projects, and stimulate the emergence of a large number of "specialized and new" enterprises. "Specialized and special new" enterprises are generally concentrated in the basic industrial field, have core competitive advantages, play an important role in connecting breakpoints and dredging blocking points, are an important force to solve the "neck" problem of key technologies, and show the characteristics of "decentralization" and "fragmentation" from the perspective of investment. From bottom to top, grasp the law of evolution in line with the times, tap the leaders of subdivided industries with core competitiveness, and "only fast but not broken" is an important means to gain income elasticity
Catalyst: in the short term, ① policy is expected to repair; ② Cost downward profit repair. In the medium and long term, pattern optimization and export.
Investment suggestion: undervalued leading enterprises have medium and long-term allocation value. Leading companies have been tested in both the upward and downward periods of the industry. In the current downward stage of the industry, they actively layout digital and international transformation and upgrading, and rely on innovation to create a deeper moat. At present, they are in a reasonable valuation range, Sany 12x and Hengli 40x. They are optimistic about the medium and long-term investment value. It is recommended to pay attention to Sany Heavy Industry Co.Ltd(600031) , Xcmg Construction Machinery Co.Ltd(000425) , Zoomlion Heavy Industry Science And Technology Co.Ltd(000157) , Shaanxi Construction Machinery Co.Ltd(600984) , Jiangsu Hengli Hydraulic Co.Ltd(601100) , Zhejiang Dingli Machinery Co.Ltd(603338) , Yantai Eddie Precision Machinery Co.Ltd(603638) Anhui Heli Co.Ltd(600761) and Hangcha Group Co.Ltd(603298) .
Risk warning: market competition intensifies and profitability decreases; The growth rate of infrastructure and real estate investment fell sharply; Overseas market expansion is less than expected
