Core view
Weekly performance of sectors: this week (2022 / 3 / 282022 / 4 / 1), the mechanical equipment index fell by 1.0%, and the top five sectors were: real estate / building materials / banking / media / transportation, with fluctuations of 10.8% / 6.3% / 5.2% / 5.0% / 4.7% respectively;
Sector valuation level: the median pettm of the machinery sector is 32x, of which the highest valuation is lithium battery equipment (78.5x) and the lowest valuation is construction machinery (12.5x). From the historical data within 10 years, the P / E ratio of the machinery sector is in the quantile of 15.18%;
Weekly tracking of individual stocks: the five stocks with the highest increase this week are Tianjin Jinrong Tianyu Precision Machinery Co.Ltd(300988) , Zhejiangtailin Bioengineering Co.Ltd(300813) , Eurocrane (China) Co.Ltd(603966) , Anhui Fengxing Wear Resistant Materials Co.Ltd(002760) , Jade Bird Fire Co.Ltd(002960) ;
Industry highlights: (1) affected by the epidemic and other factors, the purchasing manager index fell back to the contraction range in March; (2) From January to February, the profits of industrial enterprises increased slightly; (3) Guangxi will implement 16GW + photovoltaic projects in 2022, including 3.7gw of China energy construction, 2.5gw of national energy group and 2.4gw of state power investment; (4) Beijing’s “14th five year plan” energy plan: promote the construction of new energy storage projects and form a 10 million kilowatt emergency standby and peak shaving capacity.
Investment proposal and investment object
The epidemic affected the short-term decline of PMI, and the equipment peak season was slightly delayed. China’s PMI index in March was 49.50%, falling below the boom and bust line, reflecting short-term economic pressure. We believe that the decline of PMI in March was mainly affected by the epidemic, and the production, manufacturing and delivery were limited to a certain extent. According to the survey and tracking, the prosperity of production scheduling of equipment enterprises rebounded in early March, and the operating rate of downstream also developed well, reflecting the marginal improvement of economic demand under the national economic stabilization policy. From March, we expect that the orders of equipment enterprises are OK, but the delivery and delivery performance are flat. It is expected that the peak season of general equipment and construction machinery will be delayed to some extent. In fact, judging from the good start of the economy from January to February, there are signs of improvement in the operating rate of downstream projects, especially the boom in the demand for new energy related equipment is still high. We believe that the overall boom of equipment in the whole year is low before and high after, and the peak season of the industry will still come. From the perspective of structure, we believe that this round of peak season will see subtle changes in the market pattern. Firstly, the leading enterprises in the industry may obtain orders that exceed the average level with stronger delivery capacity. Secondly, the continued high prices of raw materials and energy may put pressure on profits. The prices of some automatic parts also begin to rise, and the operating cash flow / gross profit margin of enterprises may weaken. Therefore, from the perspective of peak season, we suggest to focus on general equipment / construction machinery, while from the perspective of structure, we suggest to focus on enterprises with profitable moat or high-quality balance sheet.
It is recommended to pay attention to:
(1) construction machinery: Sany Heavy Industry Co.Ltd(600031) ( Sany Heavy Industry Co.Ltd(600031) , not rated), Zoomlion Heavy Industry Science And Technology Co.Ltd(000157) ( Zoomlion Heavy Industry Science And Technology Co.Ltd(000157) , bought), Jiangsu Hengli Hydraulic Co.Ltd(601100) ( Jiangsu Hengli Hydraulic Co.Ltd(601100) , not rated), Shaanxi Construction Machinery Co.Ltd(600984) ( Shaanxi Construction Machinery Co.Ltd(600984) , not rated), Yantai Eddie Precision Machinery Co.Ltd(603638) ( Yantai Eddie Precision Machinery Co.Ltd(603638) , not rated); (2) Industrial equipment: Hangcha Group Co.Ltd(603298) ( Hangcha Group Co.Ltd(603298) , Unrated), Anhui Heli Co.Ltd(600761) ( Anhui Heli Co.Ltd(600761) , Unrated), Qinchuan Machine Tool & Tool Group Share Co.Ltd(000837) ( Qinchuan Machine Tool & Tool Group Share Co.Ltd(000837) , Unrated), Guangdong Yizumi Precision Machinery Co.Ltd(300415) ( Guangdong Yizumi Precision Machinery Co.Ltd(300415) , Unrated), Estun Automation Co.Ltd(002747) ( Estun Automation Co.Ltd(002747) , Unrated), Guangdong Topstar Technology Co.Ltd(300607) ( Guangdong Topstar Technology Co.Ltd(300607) , Unrated); (3) Logistics automation: Nanjing Inform Storage Equipment (Group) Co.Ltd(603066) ( Nanjing Inform Storage Equipment (Group) Co.Ltd(603066) , not rated), Noblelift Intelligent Equipment Co.Ltd(603611) ( Noblelift Intelligent Equipment Co.Ltd(603611) , not rated), Cimc Vehicles (Group) Co.Ltd(301039) ( Cimc Vehicles (Group) Co.Ltd(301039) , not rated); (4) Energy equipment: Wuxi Lead Intelligent Equipment Co.Ltd(300450) ( Wuxi Lead Intelligent Equipment Co.Ltd(300450) , Unrated), Shenzhen S.C New Energy Technology Corporation(300724) ( Shenzhen S.C New Energy Technology Corporation(300724) , Unrated), Yantai Jereh Oilfield Services Group Co.Ltd(002353) ( Yantai Jereh Oilfield Services Group Co.Ltd(002353) , Unrated), Zhengzhou Coal Mining Machinery Group Co.Ltd(601717) ( Zhengzhou Coal Mining Machinery Group Co.Ltd(601717) , Unrated), Tiandi Science & Technology Co.Ltd(600582) ( Tiandi Science & Technology Co.Ltd(600582) , Unrated), Nanjing Develop Advanced Manufacturing Co.Ltd(688377) ( Nanjing Develop Advanced Manufacturing Co.Ltd(688377) , Unrated); (5) Rail transit equipment: Crrc Corporation Limited(601766) ( Crrc Corporation Limited(601766) , not rated), Guangdong Huatie Tongda High-Speed Railway Equipment Corporation(000976) ( Guangdong Huatie Tongda High-Speed Railway Equipment Corporation(000976) , not rated); (6) Service & Consumption: Shenzhen Anche Technologies Co.Ltd(300572) ( Shenzhen Anche Technologies Co.Ltd(300572) , Unrated), Centre Testing International Group Co.Ltd(300012) ( Centre Testing International Group Co.Ltd(300012) , Unrated), Jack Sewing Machine Co.Ltd(603337) ( Jack Sewing Machine Co.Ltd(603337) , Unrated), Zhejiang Jiecang Linear Motion Technology Co.Ltd(603583) ( Zhejiang Jiecang Linear Motion Technology Co.Ltd(603583) , Unrated), Changzhou Kaidi Electrical Inc(605288) ( Changzhou Kaidi Electrical Inc(605288) , Unrated), Hangzhou Youngsun Intelligent Equipment Co.Ltd(603901) ( Hangzhou Youngsun Intelligent Equipment Co.Ltd(603901) , Unrated).
Risk tips
The development of the epidemic is less than expected, the macro economy is less than expected, infrastructure investment is less than expected, raw material prices rise, and Global trade conflicts intensify.
