Investment in fixed assets performed well, and the expectation of steady growth was gradually fulfilled. From January to February 2022, the year-on-year growth rate of generalized infrastructure reached 8.6%, and the effect of steady growth policy was remarkable. In terms of real estate, the investment in real estate development from January to February was significantly restored to 3.7% from – 13.9% year-on-year in December. Specifically, the construction area improved significantly year-on-year, from – 35.3% in December to 1.8%. Sales and new construction data also improved significantly, and the negative growth in a single month was further narrowed year-on-year, reaching – 9.6% and – 12.2% respectively.
The terminal recovery is conducted upward, and the metal demand is gradually released. In February, the manufacturing PMI rose to 50.2% and the construction PMI rose to 57.6%. In terms of orders, the newly signed contract amount of key enterprises has rebounded significantly since the fourth quarter of last year. The terminal performance is strong and further conducted upward, among which the demand for copper and aluminum in the power field is significantly driven. In terms of copper, the overall operating rate of downstream wire and cable enterprises reached 59.6% in February. Aluminum cables and aluminum profiles were boosted by power and building terminals, and the operating rate picked up rapidly. Benefiting from the warming of construction orders and the release of demand for pipes, the galvanizing operation rate increased to nearly 70% simultaneously.
The policy continues to make efforts to support the demand for industrial metals. At present, the capital and project end force in infrastructure will form a continuous support for the landing of physical quantity in the first half of the year, and the growth rate of infrastructure in the first half of the year may maintain a high level. In terms of real estate, the sales area of commercial housing has been negatively correlated with the individual housing loan interest rate for a long time. The housing loan interest rate continued to rise in 2021, and the five-year LPR and MLF interest rates remained unchanged throughout the year. They have been reduced to varying degrees in January this year. At present, the spread between mortgage interest rate and 5-year LPR and between 5-year LPR and MLF is significantly wider than that in 19 years. The large spread provides a certain space for the easing policy of real estate sales.
Investment suggestion: it is suggested to pay attention to Zijin Mining Group Company Limited(601899) , Yunnan Aluminium Co.Ltd(000807) , Henan Shenhuo Coal&Power Co.Ltd(000933) , Yunnan Chihong Zinc & Germanium Co.Ltd(600497) , Shenzhen Zhongjin Lingnan Nonfemet Co.Ltd(000060) .
Risk tips: macro environment changes; The growth rate of metal demand is lower than expected; The strength of the policy was less than expected.
