Last week’s market
Last week, the CSI 300 fell 0.31%, the Shenwan machinery and equipment sector fell 1.19%, outperforming the market by 0.88 percentage points, ranking 23rd among all the primary industries of Shenwan, and the 19 sub industries rose by 12. Among them, the sub industries with better performance were refrigeration and air conditioning equipment, instruments and meters, energy and heavy equipment, up 1.94%, 1.52% and 1.11% respectively.
In terms of valuation, as of January 5, 2022, the P / E ratio (TTM, overall method, excluding negative values) of Shenwan mechanical equipment sector was 25.63 times, and the valuation premium rate relative to Shanghai and Shenzhen 300 was 102%.
In terms of individual stocks, the top gainers were Bingshan Refrigeration & Heat Transfer Technologies Co.Ltd(000530) (46.58%), Naipu Mining Machinery Co.Ltd(300818) (42.76%), Guangdong Nedfon Air System Co.Ltd(301043) (33.21%), Wantong hydraulic (15.99%), Guizhou Wire Rope Co.Ltd(600992) (14.74%), and the top gainers were Huayan precision machinery (- 15.22%), Hunan Yujing Machinery Co.Ltd(002943) (- 14.69%), Zhuzhou Crrc Times Electric Co.Ltd(688187) (- 13.57%), Sanhe Tongfei Refrigeration Co.Ltd(300990) (- 13.23%) and Aerosun Corporation(600501) (- 12.80%).
Industry news
1) In December, China’s manufacturing PMI index was 50.3%, an increase of 0.2 percentage points year-on-year.
2) The Ministry of agriculture and rural areas issued the national development plan for Agricultural Mechanization in the 14th five year plan.
3) From January to November, the machinery industry achieved a total revenue of 23 trillion yuan, a year-on-year increase of 16.6%.
Company news
1) Geron Co.Ltd(002722) the controlling shareholder and the persons acting in concert signed the share transfer intention agreement.
2) Unittec Co.Ltd(000925) release the progress announcement of the project of medium and large-size semiconductor grade silicon single crystal production base of the subsidiary.
3) J.S.Corrugating Machinery Co.Ltd(000821) signed the share subscription agreement with Quanzhou Dongguan Golden Sun Abrasives Co.Ltd(300606) Electronic Technology Co., Ltd.
4) The Bestway Marine & Energy Technology Co.Ltd(300008) subsidiary signed the letter of intent for contract of 842 million yuan.
Industry strategy and individual stock recommendation this week
In terms of construction machinery, according to the data of China Construction Machinery Industry Association, the sales volume of excavators in November was 20444 units, a year-on-year decrease of 36.6%, of which 14014 units were sold in the Chinese market, a year-on-year decrease of 51.4%; 6430 sets were exported, a year-on-year increase of 89%. From January to November 2021, the sales volume of excavators was 318700 units, with a year-on-year increase of 7.66%, which was lower than the annual growth expectation of 10%. In addition, with the release of the energy consumption dual control plan by the national development and Reform Commission, a new round of production restriction measures are deployed in many places across the country, including setting the upper limit of output, staggered peak production, power restriction, requiring shutdown and maintenance, etc. We expect a new round of price adjustment in Q1 industry in 2022 to cope with the cost rise caused by production restriction. Under this expectation, it is suggested to focus on leading enterprises with strong cost transfer ability in the industry, such as leading Sany Heavy Industry Co.Ltd(600031) (600031), Shaanxi Construction Machinery Co.Ltd(600984) (600984) of construction machinery and Jiangsu Hengli Hydraulic Co.Ltd(601100) (601100) of core parts manufacturers.
In terms of Siasun Robot&Automation Co.Ltd(300024) , the Ministry of industry and information technology led the introduction of two favorable plans, which clearly put forward the goal of an average annual growth of 20% in industry revenue and doubling the Siasun Robot&Automation Co.Ltd(300024) density of manufacturing industry by 2025. The performance of Q3 Siasun Robot&Automation Co.Ltd(300024) enterprises is not optimistic this year. Some representative companies in China have experienced a sharp rise in revenue but a sharp decline in profits. The rise in cost and price is one factor, and the more fundamental reason is still limited by technical barriers. Most of China’s Siasun Robot&Automation Co.Ltd(300024) enterprises are concentrated in the field of medium and low-end products, and their bargaining power is not strong. The introduction of the two plans will accelerate the process of China’s Siasun Robot&Automation Co.Ltd(300024) industry towards high-end. In addition, with the gradual decline of China’s demographic dividend and the continuous decline of industrial Siasun Robot&Automation Co.Ltd(300024) prices, the price scissors difference between the two has been significantly reduced, and machine replacement will become an important trend in the transformation of manufacturing industry in the future. In this process, it is suggested to pay attention to domestic industrial Siasun Robot&Automation Co.Ltd(300024) leader Guangdong Topstar Technology Co.Ltd(300607) (300607) and reducer leader Leader Harmonious Drive Systems Co.Ltd(688017) (688017).
Risk warning: risk of global epidemic spread; Macroeconomic growth is lower than expected; Price fluctuation risk of raw materials; Global trade friction risk.
