The number of new covid-19 cases in China increased significantly, and the passenger transport demand decreased significantly in November 2021. We observe the change trend of passenger transport demand in the future by tracking the PMI index of non manufacturing industry, social zero growth rate, the number of Chinese tourists in major countries and the import and export amount of duty-free goods. In December 2021, the PMI index of non manufacturing industry rose 0.4pct to 52.7% month on month, of which the business activity index of service industry in December was 52.0%, up 0.9pct from November, indicating that the recovery pace of business activities of service industry has been accelerated as a whole. In November 2021, the social zero rose by 3.9% year-on-year. Compared with the same period in 2019, the growth rate of social zero in November was 9.1%, slightly lower than 9.4% in October, but it still significantly exceeded the performance in the third quarter (the growth rate in a single month was about 6% compared with that in 2019). The social zero exceeded expectations, which was mainly supported by the actual social zero recovery, and the support from prices weakened marginally. In November 2021, although the import and export amount of national duty-free goods decreased by 49.8% year-on-year, it still increased by 66% month on month. In November 2021, the number of Chinese tourists from Hong Kong, Taiwan and Japan continued to remain at a low level of less than 10000. In November 2021, the number of mainland residents visiting Australia was 741000, up 146% month on month.
The release of manufacturing capacity was accelerated, and freight demand continued to pick up month on month. We observe the change trend of freight volume in the future by tracking the manufacturing PMI index, import and export growth, industrial added value growth and fixed asset investment growth. In December 2021, the manufacturing PMI index was 50.3%, up 0.2 percentage points month on month, and the kinetic energy continued to repair; In addition, the new export order index in December was 48.1%, slightly lower than 0.4pct last month, but higher than the boom level from July to October of 21 years. In November 2021, the added value of industries above designated size increased by 3.8% year-on-year (the previous value was 3.5%), 11.1% over the same period of 19 years, and an average increase of 5.4% in two years (the previous value was 5.2%); The month on month growth was 0.37% (the previous value was 0.39%), mainly due to the timely adjustment of energy consumption policies since October 21, the gradual relaxation of supply constraints and the gradual recovery of industrial production. From January to November 2021, the cumulative growth rate of fixed asset investment was 5.2% (the previous value was 6.1%), an increase of 7.9% compared with the same period of 19 years (an increase of 0.1 percentage point compared with January to October). In November 2021, the import and export amount increased by 26.1% year-on-year, 1.8pct higher than that in October, 42.8% higher than that in the same period in 2019. With the United States stopping subsidies in September 21, it is expected that the export growth rate will peak in the fourth quarter of 21 and enter the downward range in the first quarter of 22. However, the downward speed is slow, and the export still has strong toughness.
The exchange rate of RMB against the US dollar was stable, and the price of crude oil rose slightly. Based on the cost structure of the transportation company, we track the 7-day repurchase interest rate, five-year LPR and US dollar exchange rate to observe the change trend of financial expenses; Track the oil price to observe the change trend of operating cost. On the whole, the 7-day repo rate fluctuated slightly, and the five-year LPR was not adjusted in December 21; The exchange rate of RMB against the US dollar has remained stable recently, at about 6.37 yuan / US dollar; The price of Brent crude oil has risen slightly recently and is currently maintained at more than $80 / barrel.
Investment suggestion: the number of covid-19 cases in China has increased significantly, and the recovery of air passenger transport demand has been negatively impacted. We believe that the growth logic and location advantages of first tier airport companies and airlines have not changed substantially due to the epidemic situation; With the continuous advancement of covid-19 vaccine / treatment technology, the demand for air passenger transport will gradually recover. The revaluation of first tier airport companies and airlines is a deterministic event; With the introduction of the management measures for express market (Revised Draft) (Exposure Draft), the industry supervision is expected to be further refined, the industry price war is expected to continue to ease, and the head express enterprises are expected to benefit. We maintain the "overweight" rating of the industry, recommend Air China Limited(601111) , Spring Airlines Co.Ltd(601021) , Shanghai International Airport Co.Ltd(600009) and S.F.Holding Co.Ltd(002352) , and pay attention to China Southern Airlines Company Limited(600029) , China Eastern Airlines Corporation Limited(600115) , Juneyao Airlines Co.Ltd(603885) , Guangzhou Baiyun International Airport Company Limited(600004) , Yto Express Group Co.Ltd(600233) .
Risk analysis: the duration of covid-19 epidemic exceeded market expectations; The sharp decline of macro economy leads to the decline of industry demand; Sino US trade frictions continue to ferment, and the RMB exchange rate fluctuates greatly; Crude oil prices rose sharply.
