Recent developments in the cement industry: the cement index fell 6.12% last week, underperforming the building materials index and CSI Changshu Guorui Technology Co.Ltd(300600) 449 announced that it is planning a major asset restructuring. It is planned that the company will issue A-share shares to all shareholders of China Building Materials Information Technology Co., Ltd. in exchange for shares to absorb and merge China Construction information. At the same time, it will sell the controlling rights and other assets of its cement and other related business subsidiaries to Xinjiang Tianshan Cement Co.Ltd(000877) and China building materials will restart the cement restructuring. Referring to the restructuring experience of Tianshan, the average Pb of cement assets acquired is 1.5 times. Pay attention to the follow-up Ningxia Building Materials Group Co.Ltd(600449) Gansu Qilianshan Cement Group Co.Ltd(600720) and other restructuring progress. Last week, the national cement market price was 510 yuan / ton, up 1.0 yuan / ton month on month. The price rising areas mainly include Tianjin, Henan, Guangxi and Yunnan, with a range of 20-50 yuan / ton; The falling areas are Inner Mongolia, Jiangxi, Hunan, Hubei and Ningxia, with a range of 10-30 yuan / ton. In mid April, China's cement market demand was affected by the epidemic control, and the overall performance was still poor. The average shipment rate of enterprises fell by 25 PCT year-on-year. In terms of price, in areas where off peak production has been implemented, enterprises have pushed up the price of cement synchronously to transmit the pressure of rising costs; In the areas significantly affected by the epidemic, the market oversupply was serious, and the price fell slightly.
Core view: from the beginning of the past decade to the end of the peak season (5.30), the average value of the maximum increase of the cement index was 35.3%, the lowest in 21 years was 14.5%, and the maximum increase of the cement index since the beginning of the year was only 10%. We believe that the current policy environment is more favorable than that in 21 years, and there is still room for subsequent increase. The government work report mentioned the target of GDP growth of 5.5% in 2022, the confidence of steady growth is further strengthened, and cement is expected to benefit. We judge that the demand side of the whole year is still resilient, Guangdong Tapai Group Co.Ltd(002233) , Gansu Qilianshan Cement Group Co.Ltd(600720) successively disclosed the announcement of pre deduction of performance in the first quarter, and the net profit deducted from non parent company decreased by 50% - 60% and 73% - 88% year-on-year. We expect that the sales volume and gross profit per ton are lower than last year, but we judge that 22q1 or the low point of the industry. After the Q2 epidemic recovers, with the weakening of the impact of coal price year-on-year + the opening of price rise, the performance may improve quarter by quarter, and the whole year is still expected to achieve steady growth, The valuation is expected to be repaired. In the medium and long term, cement has entered a period of downward demand. In the future, the industry will focus on the opportunities brought by the change of the industry's supply side under the objectives of "dual control" and "dual carbon": a) the policy requires that the proportion of benchmark capacity in 2025 will exceed 30%, and the industry's capacity of 2500t / D and below is expected to withdraw one after another in the future, and the total capacity will shrink by more than 8.6%. b) The cement industry is expected to be included in carbon trading in the future. The transformation of carbon tax + emission reduction intensifies the cost pressure of small enterprises, highlights the leading competitive advantage, is expected to further expand through mergers and acquisitions, enhance the voice, and gradually raise the price center. In the medium and long term, the cement industry as a whole may develop in the trend of "volume reduction and price increase". After being included in carbon trading, it may accelerate the improvement of supply side concentration, and the improvement of leading share is expected to support performance growth. From the perspective of dividend yield and valuation, cement stocks still have high investment performance price ratio.
Recommend [ Gansu Shangfeng Cement Co.Ltd(000672) ], [ Huaxin Cement Co.Ltd(600801) ], leading [ Anhui Conch Cement Company Limited(600585) ], focusing on Jiangxi leading [ Jiangxi Wannianqing Cement Co.Ltd(000789) ] and northwest leading [ Gansu Qilianshan Cement Group Co.Ltd(600720) ], which are expected to benefit from infrastructure development.
