Plate performance this week: this week (December 6-december 10, the same below), the market composite index rose broadly. The Shanghai Composite Index closed at 3666.35 points, up 1.63% this week, the Shenzhen Component Index rose 1.47% this week, and the chemical industry (Shenwan) rose 0.42%.
Performance of individual chemical stocks this week: the chemical sector rose with the market this week. The top gainers are Shanghai Nar Industrial Co.Ltd(002825) , Yueyang Xingchang Petro-Chemical Co.Ltd(000819) , Shenzhen Wote Advanced Materials Co.Ltd(002886) , Skshu Paint Co.Ltd(603737) , Nanjing Cosmos Chemical Co.Ltd(300856) , Qinghai Salt Lake Industry Co.Ltd(000792) , Yingtai Biology (delisting), Asia Cuanon Technology (Shanghai) Co.Ltd(603378) , Zhuzhou Times New Material Technology Co.Ltd(600458) , Nantong Jiangshan Agrochemical & Chemicals Co.Ltd(600389) . On December 4 and December 6 Shanghai Nar Industrial Co.Ltd(002825) , 134 institutional investors were surveyed. Relying on mature coating technology, the company cooperated with Dr. Hu Liqing and his team to carry out fuel cell membrane electrode and other businesses. This week, the stock price rose by 31.57%, leading the rise of chemical panels. This week, Shenzhen Wote Advanced Materials Co.Ltd(002886) the subject of modified plastics released the draft equity incentive plan, and the share price rose by 21.82%. Driven by the concept of photovoltaic integration (BIPV), the waterproof material sector performed strongly this week, Skshu Paint Co.Ltd(603737) rose 15.60%.
Crude oil market dynamics this week: Omikron has limited impact on the market this week. Superimposed on Saudi Arabia’s increase in the official price of crude oil, the international crude oil market fluctuated upward this week. This week, ice oil distribution closed at $75.15/barrel (mom + 7.54%); WTI crude oil closed at $71.67/barrel (mom + 8.16%).
Tracking of key chemicals: among the chemicals we are concerned about this week, yellow phosphorus (+ 11.09%), pure benzene (+ 2.88%), xylene (+ 2.58%), toluene (+ 0.67%) and solid caustic soda (+ 0.13%). The inventory of yellow phosphorus enterprises was low this week, the spot supply was insufficient, the construction of downstream enterprises was stable, and the price of yellow phosphorus continued to rise this week. This week, pure benzene was strongly supported by the price rebound of crude oil and styrene, and the price focus of pure benzene moved upward this week. Xylene was boosted by the rebound in crude oil prices this week, and some enterprises stopped for maintenance, but the downstream market demand was light, and xylene prices rose slightly this week. The unit operating rate of solid caustic soda enterprises this week is general. Recently, the terminal caustic soda industry has received goods normally, the market demand is weak and stable, and the price of solid caustic soda has been explored in a narrow range this week.
Important events of this week: the central economic work conference concluded on December 10 proposed that the new renewable energy and raw material energy consumption should not be included in the total energy consumption control, and create conditions to realize the transformation from “double control” of energy consumption to “double control” of total carbon emission and intensity as soon as possible.
Main lines of Chemical Investment: (1) cyclical growth stocks are expected to improve marginally: since the turning point of Q2 chemical boom in 2020, the prices of some chemicals have risen to historical highs. With the mismatch between supply and demand moving towards balance and superimposing the downward pressure of the economy, China’s chemical product price index (CCPI) fell from the highest 6467 on October 19, 2021 to 5219 on December 3 (- 19.44%), the traditional chemical cycle stocks made a sharp correction. In the correction process, we think we should focus on the industry leaders with continuous production expansion capacity in the 14th five year plan, supplement the price with volume, especially embrace changes and look for high-quality companies with the second growth curve, and the medium and long term is expected to cross the cycle. Key recommendations: Wanhua Chemical Group Co.Ltd(600309) , Shandong Hualu-Hengsheng Chemical Co.Ltd(600426) , satellite chemistry, China National Chemical Engineering Co.Ltd(601117) , Ningxia Baofeng Energy Group Co.Ltd(600989) , lithium iron phosphate industrial chain and soda ash industrial chain. (2) Focus on high-end manufacturing and supporting materials for high-tech industries, including biosynthesis, electronic materials, degradability, tail gas treatment, carbon fiber, etc. key recommendations: Haohua Chemical Science & Technology Corp.Ltd(600378) , Valiant Co.Ltd(002643) . (3) for the pesticide industry chain entering the business cycle, key recommendations: Jiangsu Yangnong Chemical Co.Ltd(600486) , Anhui Guangxin Agrochemical Co.Ltd(603599) .
Risk warning: crude oil supply fluctuates sharply; The situation of trade war worsened; Risk of significant exchange rate fluctuations.
