Industry perspective
Q: where is the prosperity of the general machinery industry in the cycle?
General machinery is a capital product, which is mainly used for downstream investment and production expansion, and is directly related to the prosperity and demand of downstream industries. Therefore, the demand cycle of China’s general machinery industry fluctuates with the economic cycle. We observe the output data of typical capital goods such as industrial Siasun Robot&Automation Co.Ltd(300024) , metal cutting machine tools and forklifts. It can be seen that the time span of the change cycle of general machinery demand is about 43 months. At present, the marginal demand of the industry is weakened and at the bottom stage. We select the 3-month moving smooth year-on-year data of the production and sales volume of typical capital goods, and take the average as the industry representative. According to the time of the historical average of the demand decline cycle of 22 months, the start time of the new rise cycle is about January 2023. As the selected data moves smoothly for 3 months, the data may lag by about 2 months. Therefore, we expect that a new round of demand rise cycle of general machinery industry is expected to start near the end of 2022.
Second question: why is the demand of general machinery industry resilient?
Compared with special machinery, the general machinery industry has more downstream demand fields, so it shows strong toughness as a whole; China is transitioning from a large manufacturing country to a powerful manufacturing country, and the long-term development of automation is full of power. The main driving factors are: (1) the continued strong investment in new energy vehicles, lithium batteries, photovoltaic and other emerging industries has driven the high demand growth of the general machinery industry. From January to February, the fixed asset investment in China’s manufacturing industry increased by 20.9%, of which the investment in high-tech manufacturing industry increased by 42.7%. (2) Chinese enterprises continue to carry out R & D and innovation, are gradually catching up with and surpassing foreign enterprises, and the global competition pattern is gradually reshaping. (3) In the long run, automation and intelligence are the internal requirements of manufacturing power, which will give birth to a huge demand for automation.
Third question: which direction has ushered in a good opportunity for the layout on the left?
In 2022, the general machinery sector has strong overall demand toughness, and it is expected to start a new round of boom rise cycle near the end of this year; Plate investment opportunities in the general machinery industry are gradually emerging. It is suggested to focus on high-quality tracks with sustained high growth, such as cutting tools, industrial Siasun Robot&Automation Co.Ltd(300024) , laser equipment, industrial control automation and so on. (1) Cutting tool industry: it is estimated that the scale of China’s cutting tool market is expected to reach 63.1 billion yuan in 2023, but about 2 / 3 of China’s high-end cutting tool market depends on imports. At present, the technical level of domestic cutting tools of China’s leading enterprises has reached the level of keeping up with Japan and South Korea and catching up with Europe and the United States. It has entered the golden period of domestic substitution and has broad growth space. (2) Industrial Siasun Robot&Automation Co.Ltd(300024) : China is the world’s largest industrial Siasun Robot&Automation Co.Ltd(300024) market. Compared with developed countries, China’s industrial Siasun Robot&Automation Co.Ltd(300024) density is still low and has a large growth space. Chinese industrial Siasun Robot&Automation Co.Ltd(300024) manufacturers are mainly oriented to China’s emerging markets. With the development of China’s photovoltaic, lithium battery and other emerging fields, domestic industrial Siasun Robot&Automation Co.Ltd(300024) manufacturers are expected to gradually break the all-round monopoly situation of foreign enterprises and further expand their market share. (3) Laser equipment: the continuous progress of domestic fiber laser technology has led to the continuous decline of the price of laser equipment. The reduction of cost also makes the application of laser technology in new fields more and more widely, so as to promote the vigorous investment in laser equipment in the downstream. Domestic equipment manufacturers are expected to share the dividend of increasing industrial penetration. (4) Industrial control automation: LCD and semiconductor sub industries are usually the areas where foreign brands are good at. Since 2021, the global shortage tide has accelerated the process of domestic substitution, and China’s leader has become the main beneficiary. (5) Forklift: the forklift industry presents a weak cycle, and the competition pattern is a two male separatist regime. After the stress test of the epidemic to the supply chain, the industry head concentration effect is significant, and the share of China’s shuanglongtou continues to increase.
Investment advice
The general machinery industry has sector investment opportunities, and the layout opportunities on the left are gradually emerging. We are optimistic about the subdivision direction of CNC cutting tools, industrial Siasun Robot&Automation Co.Ltd(300024) , laser equipment and so on. In the industrial Siasun Robot&Automation Co.Ltd(300024) field, it is suggested to pay attention to Siasun Robot&Automation Co.Ltd(300024) body faucet Estun Automation Co.Ltd(002747) , Efort Intelligent Equipment Co.Ltd(688165) and system integration faucet Guangdong Topstar Technology Co.Ltd(300607) ; In the field of laser equipment, it is suggested to pay attention to the fiber laser faucet Wuhan Raycus Fiber Laser Technologies Co.Ltd(300747) and the laser cutting control system faucet Shanghai Friendess Electronic Technology Corporation Limited(688188) .
Risk tips
The risk of the epidemic out of control; The risk of sharp rise in the price of raw materials; The development of emerging industries is less than expected.
