Investment summary:
Talk every Monday: fulfillment of stable growth expectation and investment direction of infrastructure
The local investment plan shows the determination of steady growth: the development plan of Henan Province in 2022 shows that the growth target of fixed asset investment is 10%, while the growth target of fixed asset investment in 2021 is 6%, with a year-on-year increase of 4pct. Hebei Provincial Development and Reform Commission released the list of key construction projects in 2022, with a total of 695 key projects, with a total investment of 1.12 trillion yuan. It is expected to complete an investment of more than 250 billion yuan during the year. 356 major projects will be opened in 2022, an increase of 104 compared with 2021. Jiangxi Province will initially implement more than 3400 large and medium-sized projects in 2022, with an annual planned investment of more than 1.1 trillion.
Deconstruction of capital investment: steady growth will continue to focus on major project investment. In 2021, 29% of the special bond funds will be invested in municipal construction and industrial park infrastructure; 18% is invested in transportation infrastructure; 19% invested in social undertakings and 15% in affordable housing projects. We predict that the investment direction in 2022 will still focus on industrial park projects and continue to drive the high boom of manufacturing investment.
Tap the prosperity of building materials: under the background of steady financial growth, the demand for cement, waterproof, steel structure and pipe materials has been greatly stimulated. The varieties of building materials at the start-up end, cement and waterproof, will be the first to meet the demand side stimulation, while the steel structure will fully benefit from the pull of infrastructure investment in the fields of transportation (bridge rigid materials), Industrial Park (plant steel structure), public buildings (steel structure fabricated) and so on. At the same time, the high prosperity of manufacturing investment will effectively drive the demand for steel structure. In addition, it is suggested to focus on the pull of the transformation of old residential areas on the coatings, especially the exterior wall coatings, in the affordable housing project. Based on the demand of housing construction for pipes, the pipe industry will also fully benefit from the high prosperity of municipal construction and rural water conservancy projects.
Key sub industry tracking:
Glass: as of January 7, the national average price of glass was 2079.86 yuan / ton, down 3.25% month on month compared with the previous week, and the decline was expanded. Downstream processing plants stopped accepting new orders and mainly digested the final orders. Most of the demand was just for replenishment. Due to the great capital pressure this year, they had no intention to increase inventory. Futures prices rebounded significantly this week, with the main contract rising 11.44% this week, and the basis converged near the delivery period. The total inventory of manufacturers in key monitoring provinces was 37.66 million weight boxes, an increase of 7.08% over last week. The inventory of manufacturers continued to increase, an increase of about 3PCT over last week. Seasonal accumulation is expected to continue. The over aged production line at the supply side brings great uncertainty. With the acceleration of cold repair plan, the glass plate configuration opportunity will be highlighted. We will continue to focus on recommending Zhuzhou Kibing Group Co.Ltd(601636) integrated leading Lutheran glass, which has entered a new growth period and has continuously increased its market share.
Cement: according to Zhuo Chuang information, as of January 7, the national average price of cement was 483.08 yuan / ton, down 2.31% from last week and up 8.17% from last year. There is no significant change in the supply and demand structure. The marginal demand of cement terminal in winter is downward. The supply is affected by staggered peak production in heating season and environmental protection control, and the operating rate is low.. The inventory of enterprises decreased slightly compared with last week. The average national clinker storage capacity ratio was 55.18%, a decrease of 0.08% compared with the previous week. The follow-up market will focus on destocking, and the price center will still move down gradually. Last week, benefiting from the market of the local valuation sector, the performance of the cement sector was acceptable. We expect it to be sustainable in the short term, and continue to recommend Anhui Conch Cement Company Limited(600585) as a leader in the cement industry and Huaxin Cement Co.Ltd(600801) with improved logic in the beneficiary region.
Consumption of building materials: at present, the expectation of steady growth is gradually fulfilled. We believe that the construction will remain strong in the first half of next year, and the first building material type that coincides with the real estate end is waterproof material. Last week, we highlighted the allocation opportunities of China Liansu. This week, we still suggest to pay attention to the further rebound of China Liansu under the realization of stable growth expectations. Lengthening the time line, the logic that the market share of consumer building materials enterprises continues to increase is still the main line of investment in the building materials industry, and the growth attribute of the industry leader has not changed. Continue to recommend Beijing Oriental Yuhong Waterproof Technology Co.Ltd(002271) , Guangdong Kinlong Hardware Products Co.Ltd(002791) , Zhejiang Weixing New Building Materials Co.Ltd(002372) , Skshu Paint Co.Ltd(603737) and China Liansu.
Market review: as of the closing on January 7, the building materials sector rose 3.25% this week, and the CSI 300 index fell 2.01%. From the sector ranking, the building materials sector ranked sixth among the 28 sectors of Shenwan last week, with an increase of 2.33% year to date, ranking sixth among the 28 sectors of Shenwan.
The top five stocks rose: Goody Science & Technology Co.Ltd(002694) , Beijing Hanjian Heshan Pipeline Co.Ltd(603616) , Ningxia Qinglong Pipes Industry Group Co.Ltd(002457) , Luoyang Northglass Technology Co.Ltd(002613) , Guangdong Sanhe Pile Co.Ltd(003037) .
The top five stocks fell: Guangdong Golden Glass Technologies Limited(300093) , St Yabo, Chongqing Sansheng Industrial Co.Ltd(002742) , Chongqing Zaisheng Technology Co.Ltd(603601) , Guangdong Kinlong Hardware Products Co.Ltd(002791) .
Investment strategy: focus on recommending China Liansu, the leader of engineering plastic pipe benefiting from infrastructure investment, Zhuzhou Kibing Group Co.Ltd(601636) with high prosperity of traditional business and entering a new growth period, Xinyi Glass, the industrial leader with continuously increasing market share, and Zhejiang Weixing New Building Materials Co.Ltd(002372) , Skshu Paint Co.Ltd(603737) , Beijing Oriental Yuhong Waterproof Technology Co.Ltd(002271) , Guangdong Kinlong Hardware Products Co.Ltd(002791) with dominant consumption attributes in building materials. It is recommended to pay attention to the cement market and steel structure leader Anhui Honglu Steel Construction(Group) Co.Ltd(002541) driven by the expected rise in infrastructure construction.
Risk tip: the demand of real estate chain declines, infrastructure investment slows down, and the price of raw materials fluctuates.
