Attention this week: the price of raw materials has continued to rise, and many waterproof and coating enterprises have raised their product prices. Affected by the continuous rise in the price of crude oil and bulk materials in the international market, the outbreak of the Russian Ukrainian war and the complexity and variability of geopolitics, the price of raw materials has continued to rise since the beginning of the year, and the prices of raw oil, asphalt and titanium dioxide have increased by 103.1%, 49.2% and 6.2% respectively year-on-year. The cost of waterproof and coating enterprises is under pressure. As of March 25, the spot price of Brent DTD crude oil in the UK was US $124.6/barrel, up 103.1% year-on-year; The transaction price of Shandong asphalt (200) market was 4550.0 yuan / ton, a year-on-year increase of 49.2%; The spot price of rutile titanium dioxide was 198000 yuan / ton, a year-on-year increase of 6.2%.
According to the letter on quality risk of engineering waterproof materials issued by China State Construction Engineering Corporation Limited(601668) waterproof Association, at the beginning of 2022, the prices of main raw materials of asphalt waterproof roll, water-based waterproof, coating, polyurethane waterproof and coating increased sharply, with an average increase of more than 30%. From January 2021 to February 2022, the prices of main raw materials in the waterproof industry rose sharply, among which asphalt, SBS and polyester tire, the main raw materials of asphalt waterproof roll, increased by 36%, 30% and 43% respectively; The main raw materials of waterborne waterproofing coatings, VAE emulsion, elastic acrylic latex and styrene butadiene latex rose by 57%, 39% and 35% respectively. Isocyanate, the main raw material of polyurethane waterproof and coating, increased by 54%. Asphalt accounts for 50% – 70% of the raw material cost of asphalt waterproof roll; The emulsion accounts for 50%-90% of water-borne waterproofing and coating raw materials. Isocyanate accounts for 30% – 50% of the raw material cost of polyurethane waterproof and coating.
In order to cope with the cost pressure, at least 30 waterproof and coating enterprises, including Keshun Waterproof Technologies Co.Ltd(300737) , Beijing Oriental Yuhong Waterproof Technology Co.Ltd(002271) , Skshu Paint Co.Ltd(603737) , have raised the prices of some products since 2022. Among them, the increase range of Keshun Waterproof Technologies Co.Ltd(300737) products is 5% ~ 30%, that of Beijing Oriental Yuhong Waterproof Technology Co.Ltd(002271) products is 10% ~ 20%, and that of Skshu Paint Co.Ltd(603737) waterproof and coating products is 10% ~ 20% and 5% ~ 15% respectively. This round of price increases may alleviate part of the cost pressure.
Plate rise and fall: this week, the Shanghai Composite Index fell 1.2%, the gem index fell 2.8%, wandequan a fell 1.4%, and building materials (Shenwan) fell 3.7%. In the sub sectors of the building materials industry, the indexes of glass, cement, refractories, pipes and other building materials fell by 2.5%, 2.1%, 0.7%, 3.1% and 2.1% respectively. The top five stocks rose: Luoyang Northglass Technology Co.Ltd(002613) (+ 61.1%), Wanbangde Pharmaceutical Holding Group Co.Ltd(002082) (+ 14.3%), Fujian Kuncai Material Technology Co.Ltd(603826) (+ 9.2%), Hainan Ruize New Building Material Co.Ltd(002596) (+ 9.1%), Guangdong Tianan New Material Co.Ltd(603725) (+ 6.7%)
Top five stocks with declines: Guangdong Golden Glass Technologies Limited(300093) (- 18.8%), Suzhou Yangtze New Materials Co.Ltd(002652) (- 12.7%), Beijing Jiayu Door Window And Curtain Wall Joint-Stock Co.Ltd(300117) (- 12.5%), Quakesafe Technologies Co.Ltd(300767) (- 11.7%), China Building Material Test & Certification Group Co.Ltd(603060) (- 10.8%)
Valuation of each section: 1) the latest TTM P / E ratio of cement Shenwan index is 8.12 times, and the P / E ratio range since the beginning of 2015 is 6.24 times ~ 32.91 times; The latest price to book ratio of Shenwan cement index is 1.18 times, and the price to book ratio range from 0.86 times to 2.73 times since the beginning of 2015. 2) The latest TTM P / E ratio of glass Shenwan index is 12.98 times, and the P / E ratio range from 12.98 times to 120.81 times since the beginning of 2015; The latest price to book ratio of glass Shenwan index is 2.98 times, and the price to book ratio range from 1.25 times to 5.66 times since the beginning of 2015. 3) The latest TTM P / E ratio of pipe Shenwan index is 23.95 times, and the P / E ratio range from 19.68 times to 87.81 times since the beginning of 2015; The latest price to book ratio of Shenwan index of pipes is 2.96 times, and the price to book ratio range from 1.99 times to 5.87 times since the beginning of 2015. 4) The latest TTM P / E ratio of refractory Shenwan index is 16.49 times, and the P / E ratio range from 13.61 times to 218.07 times since the beginning of 2015; The latest price to book ratio of Shenwan index of refractory is 1.82 times, and the price to book ratio range from 1.42 times to 6.11 times since the beginning of 2015. 5) The latest TTM P / E ratio of other building materials Shenwan index is 19.99 times, and the P / E ratio range from 17.02 times to 94.69 times since the beginning of 2015; The latest price to book ratio of other building materials Shenwan index is 2.61 times, and the price to book ratio range from 2.07 times to 7.72 times since the beginning of 2015.
Key data tracking: cement: the national cement price index decreased by 0.4% on a weekly basis and increased by 2.3% on a monthly basis. Glass: the price of glass futures increased by 8.8% on a weekly basis, and the market price of float flat glass (4.8 / 5mm) decreased by 6.1% on a weekly basis. Raw materials: the price of power coal was flat on a week-on-week basis, and the crude oil price in Brent, UK, increased by 9.9% on a week-on-week basis. Real estate infrastructure: in the first two months of 2022, real estate sales decreased by 9.6% and new construction area decreased by 12.2% year-on-year.
Industry trends: 1) cement network app: price increases in many places! Why does the “spring agitation” of the cement industry delay the future? 2) Chinese and foreign coating network: the maximum increase of coating is 30%, and the product price of Keshun is increased; 3) China building materials magazine: the prosperity of building materials industry rebounded in March 2022, and the prosperity index (MPI) was 132.9 points; 4) Cement network app: the rise of a 12 trillion market! Cement enterprises welcome the new track again! The national development and Reform Commission issued heavy documents! 5) Chinaglass.com: glass soda ash futures rose together, and spot trading continued to weaken. Important reminders for next week: 1) March 28: Triumph Science & Technology Co.Ltd(600552) performance press conference. 2) March 29: expected disclosure date of Guangdong Songfa Ceramics Co.Ltd(603268) annual report. 3) March 30: Hainan Ruize New Building Material Co.Ltd(002596) , Jinyuan Ep Co.Ltd(000546) , Huaxin Cement Co.Ltd(600801) , Luoyang Glass Company Limited(600876) , Ningxia Qinglong Pipes Industry Group Co.Ltd(002457) , China Fangda Group Co.Ltd(000055) , Changzhou Almaden Co.Ltd(002623) , Shandong Fiberglass Group Co.Ltd(605006) estimated disclosure date of annual report.
Investment suggestions: 1) steady growth, good demand and high dividend yield of cement sector. Pay attention to Guangdong Tapai Group Co.Ltd(002233) , Gansu Shangfeng Cement Co.Ltd(000672) , Huaxin Cement Co.Ltd(600801) , Anhui Conch Cement Company Limited(600585) , etc. 2) The real estate financing environment is improving, and attention is paid to the leader of home decoration building materials Beijing Oriental Yuhong Waterproof Technology Co.Ltd(002271) and so on. 3) Aluminum formwork, functional sunshade materials, domestic UTG leading enterprises and other subdivided fields have good performance, and pay attention to Jiangxi Geto New Materials Corporation Limited(300986) , Shandong Yuma Sun-Shading Technology Corp.Ltd(300993) , Triumph Science & Technology Co.Ltd(600552) , etc. 4) BIPV industry’s future space is open, focusing on Zhejiang Southeast Space Frame Co.Ltd(002135) etc.
Risk warning: the price of raw materials rises or exceeds expectations; Downstream demand or lower than expected; Environmental protection policies may be repeated; Intensified industry competition, etc.
