In 2021, the revenue of the machinery sector increased significantly, but the price rise of raw materials also put pressure on the gross profit margin. Looking forward to 2022, we continue to be optimistic about high-end manufacturing upgrading.
Core view
2022: since the epidemic in 2020, China’s economy has continued to repair and the industrial prosperity has continued to rise, but the rise in raw material prices and shipping prices have also brought great pressure. From the perspective of PMI, the prosperity in 2021 is high before and low after, which is in line with the judgment of our strategy report last year. When we observe from a longer perspective, we will find that the manufacturing industry itself has the characteristics of periodic fluctuation. In the short term, the industry growth will still be under pressure, but this is actually a process of gaining momentum. In the process of gaining momentum, we suggest paying attention to the strong α And weak β Industries and companies, while paying attention to the wave of capital expenditure brought by technological change.
Generalized counter cyclical opportunity: affected by the rising price of raw materials, poor shipping, repeated epidemic and other aspects, the industrial prosperity is under short-term pressure. We believe that the country is expected to carry out cross cycle adjustment. We suggest paying attention to construction machinery and rail transit equipment to benefit from the implementation of physical workload in early 22. At the same time, photovoltaic equipment and lithium battery equipment will continue to benefit from carbon neutralization and national policy support. In terms of long-term strategy, the state will also continue to support energy security and energy supply. It is suggested to pay attention to oil service equipment and coal machinery equipment.
The attention of the weak cycle sector may increase: (1) testing services have maintained stable growth in recent years. The industry has the characteristics of stable profits and good cash flow. At the same time, the penetration rate will also benefit from the expansion of emerging fields.
(2) We have broken down the equipment in such subdivided fields as consumption upgrading, textile and clothing, food and beverage and packaging, and found that such companies have a smoother growth curve and stable profitability.
Raw materials and exports are expected to improve marginally: from the perspective of raw materials, steel has continued to decline since Q4, and steel accounts for a high proportion in the cost of machinery enterprises. We believe that in the process of raw material price decline, the gross profit margin of leading companies in the middle reaches is expected to improve. From the export side, the overseas economy is gradually repaired, and the export of mechanical equipment continues to improve. With the production and delivery of containers and ships, the shipping price is expected to decline. We believe that export enterprises will continue to benefit.
Technology has entered the promotion and layout period: in the past few years, the comprehensive cost of Shanxi Guoxin Energy Corporation Limited(600617) has decreased and promoted the penetration rate. Looking forward to the next 2-3 years, from the perspective of technology and application breakthrough, we believe that the next 2-3 years are expected to see new technology upgrading around electrification and intelligence, such as integrated die casting of vehicle body, power exchange equipment of new energy vehicles, photovoltaic cell equipment, intelligent production line Factory electrification equipment, etc. In 3-5 years, the localization of China’s high-end equipment and the iteration of energy upgrading will bring greater development space.
Investment proposal and investment object
It is suggested to pay attention to: Sany Heavy Industry Co.Ltd(600031) , Jiangsu Hengli Hydraulic Co.Ltd(601100) , Zoomlion Heavy Industry Science And Technology Co.Ltd(000157) , Zhejiang Dingli Machinery Co.Ltd(603338) , Cimc Vehicles (Group) Co.Ltd(301039) . Crrc Corporation Limited(601766) 、 Guangdong Huatie Tongda High-Speed Railway Equipment Corporation(000976) 、 Beijing Dinghan Technology Group Co.Ltd(300011) 。 Shenzhen S.C New Energy Technology Corporation(300724) 、 Suzhou Maxwell Technologies Co.Ltd(300751) 、 Yingkou Jinchen Machinery Co.Ltd(603396) 。 Wuxi Lead Intelligent Equipment Co.Ltd(300450) 、 Zhejiang Hangke Technology Incorporated Company(688006) 、 Noblelift Intelligent Equipment Co.Ltd(603611) 、 Nanjing Inform Storage Equipment (Group) Co.Ltd(603066) 。 Yantai Jereh Oilfield Services Group Co.Ltd(002353) 、 China Oilfield Services Limited(601808) 、 Tong Petrotech Corp(300164) 、 Sinopec Oilfield Equipment Corporation(000852) 。 Zhengzhou Coal Mining Machinery Group Co.Ltd(601717) 、 Tiandi Science & Technology Co.Ltd(600582) 。 Centre Testing International Group Co.Ltd(300012) 、 Shenzhen Anche Technologies Co.Ltd(300572) 、 Guangzhou Grg Metrology&Test Co.Ltd(002967) 、 Suzhou Sushi Testing Group Co.Ltd(300416) 。 Zhejiang Jiecang Linear Motion Technology Co.Ltd(603583) 、 Changzhou Kaidi Electrical Inc(605288) 、 Quick Intelligent Equipment Co.Ltd(603203) 、 Jack Sewing Machine Co.Ltd(603337) 、 Shang Gong Group Co.Ltd(600843) 、 Hangzhou Youngsun Intelligent Equipment Co.Ltd(603901) 、 Hangzhou Iecho Science & Technology Co.Ltd(688092) 、 Guangzhou Kdt Machinery Co.Ltd(002833) 。
Anhui Heli Co.Ltd(600761) 、 Hangcha Group Co.Ltd(603298) 、 Guangdong Yizumi Precision Machinery Co.Ltd(300415) 、 Estun Automation Co.Ltd(002747) 、 Leader Harmonious Drive Systems Co.Ltd(688017) 、 Guangdong Topstar Technology Co.Ltd(300607) 、 Hangzhou Oxygen Plant Group Co.Ltd(002430) 、 Ningbo Haitian Precision Machinery Co.Ltd(601882) 、 Qinchuan Machine Tool & Tool Group Share Co.Ltd(000837) 。 Suzhou Harmontronics Automation Technology Co.Ltd(688022) 、 Shandong Weida Machinery Co.Ltd(002026) 、 Kede Numerical Control Co.Ltd(688305) 、 Weichai Power Co.Ltd(000338) 。
Risk statement
Global trade conflict risk, epidemic development less than expected, capital expenditure in oil and gas less than expected, macroeconomic changes less than expected, fixed investment in infrastructure and other industries less than expected, photovoltaic / new energy vehicle policies and production expansion less than expected.
（ Orient Securities Company Limited(600958) ）
