Current investment tips:
Cement sector: under the dual pressure of demand and cost, the performance of the sector is expected to decline by 19% year-on-year. In the first quarter, the industry faced the dual pressure of declining demand and rising costs. The weak downstream real estate combined with epidemic factors led to a significant decline in output and sales. At the same time, the sharp rise in coal prices brought pressure on unit costs. With the support of cost, the average price of cement has increased, but it can not make up for the increase in cost, and the profit of the industry is under pressure. The expected growth includes Jiangxi Wannianqing Cement Co.Ltd(000789) (5%); The year-on-year decline includes Anhui Conch Cement Company Limited(600585) (- 15%), Fujian Cement Inc(600802) (- 26%), Guangdong Tapai Group Co.Ltd(002233) (- 83%), Gansu Qilianshan Cement Group Co.Ltd(600720) (- 92%); Losses include Tangshan Jidong Cement Co.Ltd(000401) , Xinjiang Qingsong Building Materials And Chemicals(Group)Co.Ltd(600425) .
Glass sector: the profit is down, and the performance of the sector is expected to decline by 38% year-on-year. Float glass is also subject to the cost pressure brought by the weak real estate and raw fuels such as soda ash, and the profit of the industry is under pressure. It is estimated that: Zhuzhou Kibing Group Co.Ltd(601636) (- 41%).
Consumer building materials and others: subject to the prosperity of real estate, capital chain and cost pressure, the performance of individual stocks varies greatly, and the performance of the sector is expected to increase by 14% year-on-year. The profit of consumer building materials in the first quarter continues to be under pressure, the delivery and payment of downstream real estate enterprises have not improved, the upstream cost side is also under pressure simultaneously, and the profit of leading enterprises is generally under pressure. Expected growth includes Cofco Engineering & Technology Co.Ltd(301058) (50%), China Jushi Co.Ltd(600176) (32%), Beijing Oriental Yuhong Waterproof Technology Co.Ltd(002271) (10%), Zhejiang Weixing New Building Materials Co.Ltd(002372) (5%), Beijing New Building Materials Public Limited Company(000786) (3%); The year-on-year decline includes Skshu Paint Co.Ltd(603737) (- 38%), D&O Home Collection Co.Ltd(002798) (- 34%), Guangdong Dongpeng Holdings Co.Ltd(003012) (- 25%), Guangdong Kinlong Hardware Products Co.Ltd(002791) (- 10%), Jiangsu Canlon Building Materials Co.Ltd(300715) (- 6%), ad shares (- 5%), Keshun Waterproof Technologies Co.Ltd(300737) (- 1%); Losses include Asia Cuanon Technology (Shanghai) Co.Ltd(603378) .
The growth is still incomplete and the allocation is still not stable. 1) Referring to the four real estate downward stages in 2008, 2012, 2014 and 2018, the starting point of the relative income of the steady growth sector starts from the loose policy and ends 3-6 months before the policy withdrawal or falsification. At present, the policy easing began soon, and the data inflection point has not yet appeared. It is expected that there is still a policy intensive introduction period after the epidemic eased, and the market interpretation is still in the medium term. 2) Stock selection should pay attention to the differences in structure and history. Previously, each round of real estate downward cycle was accompanied by high real estate inventory. The loose real estate policy path is simple. The relaxation on the demand side can see the impact, and the fundamentals have stimulating conditions. However, this round of real estate downturn is accompanied by low inventory, many policy constraints, and the demand side does not have the conditions for large easing. The policy needs to move repeatedly between loose supply and loose demand to maintain “discretion”, and take land acquisition as a forward-looking indicator. The real estate investment data in the second half of the year is not optimistic. We judge that this round of real estate easing and data repair cycle will be long and slow. Considering that infrastructure has played a more hedging role in real estate in history, and the importance and necessity of infrastructure have increased under the current background of stable growth, if we want to achieve or approach the annual GDP growth target, infrastructure is not allowed to be mediocre, and there is more room to expect in the second half of the year, so we prefer investment rights to infrastructure.
Investment analysis opinion: building materials opportunities mainly include cement and consumer building materials (as well as Cofco Engineering & Technology Co.Ltd(301058) , independent logic). 1) Cement: unlike 2018, the sector does not have price logic, so it is difficult to have an absolute return market for large-scale sectors, which means that stock selection needs to be more flexible. Conch and other white horse core is both offensive and defensive. Looking at the relative income, the absolute income depends on the participation of cement stocks in hot spots. It is partial to theme and expectation. For example, the current rise of cement stocks in Xinjiang is obvious. It is expected that the market will return to cement stocks in East China (Anhui and Zhejiang) after the improvement of the epidemic in the next stage. 2) Consumer building materials: Historically, the inflection point of the consumer building materials sector is synchronized with the real estate data and slightly later than the real estate sector (the inflection point of the real estate sector is synchronized with the policy and earlier than the data), so it is currently in the left position. However, with reference to historical experience, the absolute income in the two years after the intervention is quite abundant. We believe that it has layout value at present.
Give priority to the waterproof and pipes of both infrastructure and real estate in the downstream. It is suggested to pay attention to Beijing Oriental Yuhong Waterproof Technology Co.Ltd(002271) , Keshun Waterproof Technologies Co.Ltd(300737) , China Liansu, followed by Guangdong Kinlong Hardware Products Co.Ltd(002791) , Beijing New Building Materials Public Limited Company(000786) , Zhejiang Weixing New Building Materials Co.Ltd(002372) . 3) Cofco Engineering & Technology Co.Ltd(301058) : the company matches many policy main lines such as “steady growth + Food Security + cold chain logistics + state-owned enterprise reform”. The subdivided track is at the policy tuyere and the performance is highly flexible. It is expected that 2022 will be the inflection point and 2023 will be the outbreak point.
