Market Review
Last week (02210225) five trading days, the building materials (CITIC) index fell by 5.91%, and the CSI 300 fell by 1.67%. The infrastructure and real estate sectors related to steady growth and the underlying rose significantly, while the underlying related to industrial building materials (new energy) rose better. Among individual stocks, Sf Diamond Co.Ltd(300179) , Guangdong Dowstone Technology Co.Ltd(300409) , Jinyuan Ep Co.Ltd(000546) , Flat Glass Group Co.Ltd(601865) , Luoyang Glass Company Limited(600876) led the increase.
The callback of building materials before the two sessions is relatively common, and excess returns are still expected after the two sessions
From the market situation of 17-21 years, the building materials index is likely to have a correction before the two sessions. This phenomenon is more obvious in 17 / 18 / 20 years. We believe that the main reasons may be: 1) the construction market after the Spring Festival is more due to the expected improvement, and the economic data of January / February will be released in mid March, ushering in the data cashing period; 2) The government work report of the two sessions will announce the annual economic growth target and the policy direction for real estate and infrastructure, ushering in the policy fulfillment period. In the one month after the government work report of the two sessions in 17-21, except 2020, the building materials index has a certain excess return relative to CSI 300 in other years. In other years, due to the overall good prosperity of new construction and sales of real estate, the building materials index is generally good. After the two sessions in 2019, the macro credit environment and the year-on-year growth rate of new real estate construction and sales area have improved better month on month, which may also be the main reason for the stronger excess return of building materials in one month after the two sessions in that year than in previous years.
One month after the two sessions, the regularity of revenue ranking of the sub sector is not strong. The cement sector performed well in 17-19 years, other structural materials (pipe piles and concrete pipes) performed well in 18 / 19 / 21 years, and consumer building materials (other decorative materials + ceramics) performed well in some years. Therefore, we believe that the performance of sub sectors may have a great correlation with the policy environment and fundamentals at that time. We expect that the steady growth in 22 years may still be one of the core lines of the policy. At the same time, with the continuous development of the policy, the bottom recovery of the physical volume growth index is expected to gradually appear, and the fundamentals of photovoltaic glass are also expected to benefit from the recovery of industry demand and the decline of cost margin. Therefore, after the two sessions, we can pay attention to the varieties of infrastructure, real estate and new energy chain. Relevant sectors include consumer building materials, cement, photovoltaic glass, etc.
Continue to be optimistic about stable growth and fundamental reversal, and recommend the consumption of building materials / pipelines / cement, etc
1) influenced by the prosperity of real estate, capital chain and cost pressure last year, the above factors are expected to gradually improve. In the medium and long term, the leading companies have started channel reform, and the scale effect is expected to continuously improve the industry concentration, both long and short; 2) The downstream of the plastic pipeline sector has both infrastructure and real estate. The infrastructure end is expected to benefit from the warming of municipal pipe network investment, and the logic of the real estate end is similar to that of consumer building materials; 3) Cement is expected to benefit from the improvement of follow-up infrastructure and real estate demand. In the medium and long term, the supply pattern is expected to be continuously optimized; 4) At present, the market value of the leading glass enterprises is at a low level. At present, they are in the period of accelerated resumption of work in spring, and the glass price is expected to gradually rise. This year, the overall supply and demand of the industry may still be in a tight balance, the unit profit of float glass is expected to be relatively stable, photovoltaic glass is expected to benefit from the recovery of the industrial chain, and electronic glass is expected to benefit from the large volume of new products such as domestic substitutes and folding screens; 5) The demand side of glass fiber is driven by the downstream of wind power and overseas, and the increment on the supply side is limited.
Investment advice
Recommendations for consumer building materials Monalisa Group Co.Ltd(002918) , Dehua Tb New Decoration Material Co.Ltd(002043) , Zhejiang Weixing New Building Materials Co.Ltd(002372) , Beijing New Building Materials Public Limited Company(000786) , Beijing Oriental Yuhong Waterproof Technology Co.Ltd(002271) , etc; The pipeline recommends China Liansu, Shandong Donghong Pipe Industry Co.Ltd(603856) , ad shares, etc; Cement recommendations Gansu Shangfeng Cement Co.Ltd(000672) , Huaxin Cement Co.Ltd(600801) , Anhui Conch Cement Company Limited(600585) , Jiangxi Wannianqing Cement Co.Ltd(000789) ; Glass recommended Triumph Science & Technology Co.Ltd(600552) , Zhuzhou Kibing Group Co.Ltd(601636) , Xinyi Glass, etc; Glass fiber recommendation China Jushi Co.Ltd(600176) , Sinoma Science & Technology Co.Ltd(002080) etc;
The price trend of glass exceeds the expectation, which has an impact on the price rise of real estate; The promotion of old reform and new urbanization was less than expected.
