Market Review
Last week (1206-1210), the building materials (CITIC) index rose 2.27%, and the CSI 300 rose 3.14%. The consumption of building materials and glass in the real estate chain in the sub sector increased better. We judge that it is related to the recent recovery of real estate policy and the recovery of the prosperity of glass high-frequency index. Among individual stocks, Luoyang Glass Company Limited(600876) , Guangdong Kinlong Hardware Products Co.Ltd(002791) , Xinjiang Guotong Pipeline Co.Ltd(002205) , D&O Home Collection Co.Ltd(002798) , Guangdong Dongpeng Holdings Co.Ltd(003012) led the increase.
The “stability” of the central economic work conference is in the forefront, and the consumption of building materials, glass and cement is expected to benefit
The central economic work conference was held last week. We believe that the conference further emphasized the importance of steady growth and contributed to the continuous repair of building materials demand side expectations and fundamentals. Compared with the meeting at the end of last year, this central economic work conference has put more emphasis on the uncertain factors facing the economy and put stable growth in the primary position of economic work. Under such a tone, the macro environment next year may be more friendly to infrastructure and real estate investment, which is conducive to home decoration building materials, float glass, photovoltaic glass and cement.
1) In terms of fiscal policy, this year’s meeting proposed to moderately advance infrastructure investment, while the 20-year economic work conference did not explicitly mention infrastructure investment, but under the constraints of funds, the recovery of infrastructure is more likely to be structural; 2) The main tone of “no speculation in housing and housing” has not changed, but the expression margin has eased. On a month on month basis, the demand for home decoration and building materials next year is expected to benefit from the marginal improvement of the real estate boom, the accelerated construction of affordable housing and furniture home decoration to the countryside; 3) The new renewable energy and raw material energy consumption are not included in the total energy consumption control, and the downstream demand for photovoltaic glass is expected to improve. If the demand recovers, the short-term mismatch between supply and demand is expected to bring the price of photovoltaic glass upward, while in the medium and long term, the leading growth is expected to continue.
The outlook of the real estate chain is expected to improve marginally. It is suggested to pay attention to the medium and long-term investment value of the leading consumer building materials
1) Since the beginning of this year, the consumption of building materials has been affected by the real estate boom, the capital chain and the cost pressure caused by the continuous rise of bulk commodity prices. At present, the above factors are expected to be gradually improved. In the medium and long term, the leading companies have opened channel changes, and the scale effect is expected to continuously improve the industry concentration. The consumption of building materials is still the preferred track in the building materials sector in the medium and long term. 2) Although high raw material prices and tight capital chain drag on investment demand, we expect the subsequent real estate demand to hit the bottom and pick up. At the same time, steady growth is also expected to marginally boost infrastructure demand. The rigidity of glass supply is strong, and the demand was previously affected by downstream funds and limited films. We believe that the current market value of glass leaders has been at a low level, and the demand of subsequent industries is expected to improve; Cement is expected to benefit from the subsequent improvement of real estate demand, the rapid decline of cost is expected to improve unit profit, and the supply pattern is expected to be continuously optimized in the medium and long term; The demand side of glass fiber is driven by wind power, overseas and other downstream, the increment on the supply side is limited, the tight balance between supply and demand drives the product price to remain high, and the leading performance is expected to exceed expectations.
Investment advice
Medium and long term recommendations for consumer building materials Beijing Oriental Yuhong Waterproof Technology Co.Ltd(002271) , Monalisa Group Co.Ltd(002918) , Asia Cuanon Technology (Shanghai) Co.Ltd(603378) , Skshu Paint Co.Ltd(603737) , Keshun Waterproof Technologies Co.Ltd(300737) , Beijing New Building Materials Public Limited Company(000786) , etc. Glass recommended Zhuzhou Kibing Group Co.Ltd(601636) , Xinyi Glass, Flat Glass Group Co.Ltd(601865) (combined coverage with Dianxin); glass fiber recommended China Jushi Co.Ltd(600176) , Sinoma Science & Technology Co.Ltd(002080) ; cement recommended Gansu Shangfeng Cement Co.Ltd(000672) , Huaxin Cement Co.Ltd(600801) , Anhui Conch Cement Company Limited(600585) .
Risk tip: the demand for infrastructure and real estate fell more than expected, affecting the rising trend of cement and glass prices; The promotion of old reform and new urbanization was less than expected.
