Key investment points
This week (2022.4.11 – 2022.4.15, the same below): the building materials sector (SW) rose or fell by - 5.11% this week. In the same period, the CSI 3 and wandequan a indexes rose or fell by - 0.99% and - 2.46% respectively, and the excess return was - 4.12% and - 2.65% respectively.
Fundamentals and high-frequency data of bulk building materials: (1) cement: the market price of high-standard cement in China this week was 508 yuan / ton, which was + 2 yuan / ton compared with last week and + 57 yuan / ton compared with the same period in 2021. Regions with higher prices than last week: Pan Beijing Tianjin Hebei region (+ 8 yuan / ton), Guangdong and Guangdong region (+ 15 yuan / ton), North China (+ 1 yuan / ton), Central South Region (+ 3 yuan / ton), southwest region (+ 10 yuan / ton); Areas where prices fell: the average cement warehouse location of sample enterprises in the Yangtze River Basin (- 4 yuan / ton), Northwest (- 2 yuan / ton) and East China (- 2 yuan / ton) this week was 64.1%, up + 0.0pct from last week and + 17.0pct from the same period in 2021.
The average cement delivery rate (daily delivery rate / production capacity) of the national sample enterprises was 55.3%, which was +2.3pct compared with last week and -25.1pct compared with the same period in 2021. (2) Glass: according to the statistics of Zhuo Chuang information, the average price of the national float white glass original sheet is 2046 yuan / ton, which is - 52 yuan / ton compared with last week and - 282 yuan / ton compared with the same period in 2021. According to the statistics of Zhuo Chuang information, the original film inventory of sample enterprises in 13 provinces in China was 59.58 million heavy boxes, up from + 2.45 million heavy boxes last week and + 33.66 million heavy boxes in the same period in 2021. (3) Glass fiber: the median turnover of alkali free 2400tex direct yarn is 6150 yuan / ton, the same as last week and the same as the same period in 2021.
Zhou's view: the policy continues to relax, the central bank reduces the reserve requirement, and all localities continue to loosen the real estate, such as the relaxation of real estate capital supervision in Nanjing. However, the rapid rise of inflation restricts the relaxation of short-term monetary policy, and the epidemic also hinders the transmission of monetary easing to the real economy. We believe that this round of rise is as tortuous as the fundamentals, but it comes more from the emotional level. It is highly probable that the growth rate of performance will rise step by step in the next four quarters. As a core variety in the investment chain, building materials need more attention, whether it is cyclical or growing. It is suggested to pay attention to Beijing Oriental Yuhong Waterproof Technology Co.Ltd(002271) , Keshun Waterproof Technologies Co.Ltd(300737) , Guangdong Kinlong Hardware Products Co.Ltd(002791) , Beijing New Building Materials Public Limited Company(000786) , Zhejiang Weixing New Building Materials Co.Ltd(002372) , Huaxin Cement Co.Ltd(600801) , Gansu Shangfeng Cement Co.Ltd(000672) , Anhui Conch Cement Company Limited(600585) , China Liansu, etc.
In terms of bulk building materials: steady growth is expected to continue to rise. Under the pressure of centralized cashing in May and June, it is difficult to significantly accelerate the speed of short-term real estate construction. Infrastructure needs to be strengthened to hedge against the economic downturn. The restriction of the epidemic on the construction rhythm is expected to make the demand more concentrated in the third and fourth quarters. The adjustment of peak shifting policy in Fujian this week tested the industry's self-discipline, but had limited impact on the overall market pattern of the country. It is expected that as the epidemic situation eases, the implementation of infrastructure projects will contribute to the physical demand. The markets along the Yangtze River and the Pearl River Delta with relatively high core capacity utilization and good industry structure are expected to take the lead in seeing the cement price elasticity exceeding expectations. Industry self-discipline + potential environmental protection and energy consumption constraints shrink the supply capacity of the industry. In the medium term, the capacity utilization rate of the industry is expected to remain high, and the profit center will remain medium to high. The dividend yield of 5 ~ 8% in 2021 makes the current valuation of 7 times P / E ratio have room for repair. It is suggested to focus on Huaxin Cement Co.Ltd(600801) , Anhui Conch Cement Company Limited(600585) and Gansu Shangfeng Cement Co.Ltd(000672) with strong performance certainty and bright spots in the extension of medium and long-term industrial chain, and Tangshan Jidong Cement Co.Ltd(000401) , Xinjiang Tianshan Cement Co.Ltd(000877) , Gansu Qilianshan Cement Group Co.Ltd(600720) , etc. that benefit from the integration of northern market and great business elasticity in the medium and long term.
Decoration building materials: previously, the valuation of the decoration building materials sector has been in the lower position of the historical center due to the impact of slowing demand, rising raw materials and cash flow pressure. Since March, waterproof material enterprises have intensively issued price raising letters for the recent sharp rise in raw material prices, which is expected to be reflected in Q2. Although most enterprises' shipments are affected by the short-term epidemic, some front-line leading enterprises have a high order growth rate. With the expectation of marginal relaxation of real estate, the decline of high raw material costs, the implementation of price transmission, the withdrawal of bad debts and the gradual release of cash flow risk expectations, the overall sector is expected to usher in performance and valuation repair. Referring to the historical experience of the consumer building materials sector and the current competitive situation, in the stage of capital easing + confidence gradually recovering from the bottom of the real estate industry, some companies may take the lead to further increase their share and enter a new expansion cycle with the help of channel leading layout, operating efficiency advantage or financing plus leverage. The inflection point of shipment or order growth can be used as a signal on the right. Focus on Guangdong Kinlong Hardware Products Co.Ltd(002791) , Beijing Oriental Yuhong Waterproof Technology Co.Ltd(002271) , Keshun Waterproof Technologies Co.Ltd(300737) , Beijing New Building Materials Public Limited Company(000786) , Zhejiang Weixing New Building Materials Co.Ltd(002372) , China Liansu, ad shares, Monalisa Group Co.Ltd(002918) , Jiangsu Canlon Building Materials Co.Ltd(300715) , Zhejiang Walrus New Material Co.Ltd(003011) , etc.
Risk warning: the epidemic situation exceeded expectations, the real estate credit risk was out of control, and the policy concentration exceeded expectations
