Industry perspective
Historically, the chemical sector has been significantly affected by crude oil prices: by examining the sensitivity and transmission capacity of different chemicals to oil prices during the rise of oil prices, we traced the price and share price changes of different chemical sectors during the sharp rise of oil prices since 2000. The stock price performance of the chemical sector is affected by both the supply and demand of crude oil and its own supply and demand. In the early stage of oil price rise, the rise of crude oil price driven by demand can be better transmitted to the chemical sector, driving the better performance of stock price. In the later stage, the rise of oil price catalyzed by events may bring more cost pressure to chemical products, and the stock price is weaker than that in the early stage. In addition, The disturbance of the supply of chemicals will also have an impact on the transmission capacity of rising oil prices.
The performance of the overall sector of chemical products is better in the early stage of the upward cycle than in the later stage. Compared with the change of crude oil price, the performance of China’s basic chemical industry sector is more obvious to follow the performance of China’s overall energy commodities. The performance of basic chemical industry is also affected by the price of crude oil and coal. When the performance of the two major energy sources is consistent, it shows a more obvious elastic change, and there will be some differentiation in the process of differences in the change stage. In the early stage of energy price changes, the overall sector performed more actively, and in the further lifting stage after the high back-end price, the stock market performance was differentiated.
In the early stage of crude oil price rise, the cost transmission capacity of bulk products is relatively strong, but in the later stage, the types of products with narrowed price difference are increasing. Affected by the supply and demand of their respective fields, the price difference of chemical products has not formed a relatively consistent response, but on the whole, the price difference of bulk chemical products in the front of the industrial chain has increased more and decreased less. According to the division of the stage of crude oil price rise in the early stage, in the early stage of crude oil price rise, the cost rises, the price transmission capacity is relatively smooth, and there are relatively many types of products with enlarged price difference. However, after the crude oil price reaches a high level, it still continues to rise, the resistance of the downstream to high priced products increases, and the difficulty of price transmission increases. It can be seen that in the later stage of crude oil price rise, The types of products with narrowed price difference increase, and the profit pressure increases.
Investment advice
Focus on the subdivided varieties with a relatively high proportion of production capacity in Europe: Europe is driven by the sharp increase in energy prices and the increase in product prices driven by costs. For relevant Chinese enterprises, on the one hand, they may benefit from the price increase benefits brought by the regional price increase of important chemicals in Europe to the world, on the other hand, they can take advantage of the relatively low cost of Chinese raw materials to increase the competitiveness of overseas exports. It is suggested to pay attention to vitamins (VA, VE, VB2) Methionine, calcium pantothenate, MDI, TDI, caprolactam, etc.
Pay attention to the track with rigid demand and strong anti risk ability: products with relative cost advantage and the basis of expanding price difference are expected to benefit from the rising price of raw materials. It is suggested to pay attention to relevant products of coal chemical industry: synthetic ammonia, olefin, ethylene glycol, etc; If the products benefit from the rigid demand support or the demand increase caused by relevant policy incentives, the upward cost will be more likely to be transmitted to the downstream. It is suggested to pay attention to the agrochemical sector with rigid demand (chemical fertilizers, pesticides, etc.) and the upstream material sector with expected policy support, such as some products in the field of building materials and some products in the upstream of new energy.
Growth stocks may gradually enter the distributable range: compared with bulk chemicals, the profit space of fine chemical products is relatively high, and the price transmission lags behind, which affects the performance of the current period. At the same time, with the adjustment of stock price, the decline range of crude oil price, the relative income of fine chemical sector, and the valuation of fine chemical sector is basically at the bottom when the crude oil price is at a high level, There are relatively good investment opportunities. It is suggested to focus on relevant tracks with long-term growth logic and domestic alternative fields, such as optical film, molecular sieve, sweetener, etc
Risk tips
Sharp fluctuations in energy prices; Risk of policy change; The risk of recurrent outbreaks.
