This week, the construction sector outperformed the market. In the performance of the annual report performance forecast that has been disclosed, the performance of engineering construction, local construction enterprises, private construction enterprises, steel structure sector and overseas sector construction enterprises is generally good, the performance of the design sector is relatively stable, and the overall performance of the garden sector and decoration sector is weak.
The overall rise of construction outperformed the market, and the sub sectors rose less and fell more: this week, the Shenwan construction index closed at 2272.8 points, up 0.2% month on week, outperforming the market. The industry's average price to book ratio was 1.0 times, unchanged from last week. Segments rose less and fell more, among which construction machinery and electrical equipment rose by 5.4%, with the largest increase; The consulting sector fell 2.6%, the biggest decline.
Pay attention to the performance of the annual report of the construction sector, and the performance of engineering construction and local construction enterprises is better: Recently, a number of construction enterprises have successively released the performance express of 2021, covering design, garden, decoration, engineering construction and other subdivided industries. Among them, 6 companies in the design sector disclosed the 2021 performance express, 7 in the garden sector, 5 in the construction sector, 7 in the local sector, 9 in the decoration sector, and 7 companies in private enterprises, steel structures and overseas sectors disclosed the 2021 performance express. Overall, the performance of the design sector is relatively stable Shenzhen Capol International&Associatesco.Ltd(002949) net profit attributable to the parent company has declined compared with 2020, but with the stabilization of policies in the real estate industry and the state's encouragement of the development of prefabricated construction and BIM Technology, we believe that the company's performance is expected to improve in 2022. In addition, the overall performance of engineering construction and local construction enterprises is also good Sichuan Road & Bridge Co.Ltd(600039) , Shandong Hi-Speed Road&Bridge Co.Ltd(000498) net profit attributable to the parent company increased more than many peer enterprises. "Moderately advanced infrastructure construction" is expected to further improve the performance of local construction enterprises. The performance of private construction enterprises, steel structure enterprises and overseas construction enterprises is generally good, while the overall performance of garden sector and decoration sector is weak.
Infrastructure investment rebounded year-on-year, and real estate investment continued to decline year-on-year: in December, fixed asset investment was 7.0 trillion, an increase of 2.0%, of which the completed investment in infrastructure and real estate development was 1.9 trillion and 1.0 trillion respectively, with a year-on-year growth rate of 3.8% and - 13.9% respectively. Compared with November, infrastructure investment picked up in December, and real estate investment fell further. In infrastructure construction, the investment in power, transportation and public utilities was 0.42 trillion yuan, 0.59 trillion yuan and 0.88 trillion yuan respectively, with a year-on-year growth rate of 8.1%, 7.1% and - 0.3% respectively. The year-on-year growth of electric power and transportation is relatively large, and the year-on-year decline of public water conservancy investment is also significantly reduced compared with November. The central economic work conference in 2021 called for "accelerating the preliminary work and construction progress of major water conservancy projects" and the recent release of the comprehensive transportation plan for the 14th five year plan in many regions. The total investment has been significantly increased compared with the 13th five year plan. It is expected that there will be a large development space for transportation, water conservancy and other subdivisions in 2022.
Construction continued to decline, completion increased year-on-year, and the land transaction area decreased significantly year-on-year: in December, the planned land transaction area in 100 large and medium-sized cities totaled 150 million square meters, with a decrease of 55.8%, and the average transaction floor price was 3138 yuan / square meter. The construction, completion and sales areas were 160, 330 and 210 million square meters respectively, with year-on-year growth rates of - 31.2%, 1.9% and - 15.6% respectively. In December, the land transaction and supply area decreased significantly, the average transaction floor price increased, and the unit price of listed floor decreased; The new construction data decreased compared with the same period last year, and the completion data increased year-on-year. Due to the demand for payment collection of real estate enterprises at the end of the year, the completion data performed well and the new construction data was slightly weak. However, with the development of infrastructure investment and the signs of marginal policy easing in the real estate industry, we believe that the new construction data may improve.
Key recommendation
Key recommendation: infrastructure sector, Shenzhen Capol International&Associatesco.Ltd(002949)
Main risks of rating
Risk tip: manufacturing investment slows down, assembly promotion is less than expected, and macro liquidity is tightened.
