Event: on April 18, 2022, the National Bureau of statistics released the macro data of fixed asset investment in March 2022. The national fixed asset investment (excluding farmers) was about 10.49 trillion yuan, a year-on-year increase of 9.3%, down 2.9 PCT from January to February; In March, the investment in fixed assets (excluding farmers) was about 5.41 trillion yuan, an increase of 0.61% month on month (quarter on quarter). From January to March, the investment in railway transportation industry decreased by 2.9% year-on-year, 5.1 PCT narrower than the decline from January to February; Investment in road transport industry increased by 3.6% year-on-year, and the growth rate dropped by 4.6 PCT.
From January to March 2022, the national real estate development investment was 2.78 trillion yuan, with a year-on-year increase of 0.7%, and the growth rate fell by 3 PCT; Among them, the completed amount of residential investment was about 2.08 trillion yuan, a year-on-year increase of 0.7%. From January to March, the sales area of commercial housing totaled about 310 million square meters, a year-on-year decrease of 13.89%, an increase of 4.29 PCT compared with that from January to February. The new construction area of houses totaled 298 million square meters, a year-on-year decrease of 17.50%, an increase of 5.3 percentage points compared with that from January to February. The housing construction area totaled 8.063 billion square meters, a year-on-year increase of 1.0%, down 0.8 percentage points from January to February. The completed housing area totaled about 169 million square meters, a year-on-year decrease of 11.50%, an increase of 1.7 percentage points compared with that from January to February. From January to March, the land acquisition area of real estate development enterprises totaled 13 million square meters, a year-on-year decrease of 41.80%, which was 0.5 PCT narrower than that from January to February.
From January to March 2022, the cumulative cement output in China was 387 million tons, a year-on-year decrease of 12.1%, 5.7 percentage points lower than that from January to February. In March, the monthly cement output in China was 187 million tons, a year-on-year decrease of 5.6%; From January to March, the output of flat glass was 253 million weight boxes, with a year-on-year increase of 2.0%, which was the same as that from January to February. In March, the monthly output was 87.22 million weight boxes, with a year-on-year increase of 2.2%.
The policy continues to catalyze, and the inflection point of real estate fundamentals is gradually approaching. Affected by the epidemic in many places, the real estate data in March continued the downward trend from January to February, and the investment in real estate development maintained an increase, but the growth rate was the lowest in 20 months; The year-on-year decline rate of new construction / completion / sales end of houses is larger than that in the previous two months; The decline in land purchase area and total transaction price narrowed slightly, and the average transaction price of land increased significantly year-on-year. In the first quarter, China's GDP grew by 4.8%, which is a certain gap compared with the annual growth target of 5.5%. Under the background of increasing downward pressure on China's economy, real estate, as an important part of stabilizing the economy, is expected to hit the bottom and rebound under the catalysis of policies. Since 2022, 70 cities have issued real estate market regulation policies. At the sales end, policies such as relaxing the qualification of provident fund, reducing the proportion of down payment and reducing the interest rate of mortgage loans have been extended to Zhengzhou, Fuzhou, Qinhuangdao, Suzhou, Nanjing and other places to cancel or relax the purchase threshold; In terms of land auction, in March, 14 key cities such as Shenzhen, Guangzhou, Xiamen and Wuhan issued the first batch of centralized transfer announcements. Although the land supply decreased year-on-year, it increased by 115% month on month. Among the six second tier cities that completed the first round of land auction in March, the premium rate of Hefei, Xiamen and Chongqing rebounded, and the land auction market in hot cities is expected to pick up; Many places are turning from urban policy to practical relaxation; We believe that the real estate policy continues to catalyze, the inflection point of the industry is gradually approaching, and the trend of low before and high after the whole year is determined β It will drive the repair market of the real estate chain.
The issuance of special bonds was accelerated, and infrastructure played a counter cyclical regulatory role. Infrastructure construction may become another important starting point under the background of steady growth. In December 2021, the Ministry of finance has issued a quota of 1.46 trillion yuan of new special bonds in 2022 to local governments in advance. At the end of March, the Ministry of Finance issued the remaining quota of new special bonds to local governments. Although the amount of newly added special bonds in 2022 was 3.65 trillion yuan the same as last year, by the end of March, all localities had issued about 1.33 trillion yuan of special bonds approved in advance, which was about 6.5x in the same period of 21 years. The process was significantly accelerated. Corresponding to the projects, the construction rate of projects supported by special bond funds issued this year reached 75%. Recently, the State Council and other regulatory authorities required that local governments strive to complete the amount of new special bonds issued in advance in December last year by the end of May and the issuance of the remaining amount at the end of March by the end of September. If the plan is implemented smoothly, the progress of 97% of new special bonds issued in 2022 will be significantly accelerated compared with that in mid December of 21. Among them, urban renewal projects such as underground pipe network / old community reconstruction and livelihood projects such as affordable rental housing projects are one of the three key projects. We believe that under the downward pressure of the economy, infrastructure plays the role of counter cyclical regulation and has also become an important part of the underlying economy. The undervalued sectors related to large buildings are expected to continue to come out of the repair market.
Cement: waiting for the cement demand after the epidemic situation is alleviated, we hope to release it in a centralized manner. Recently, due to repeated epidemics in many places, the construction of downstream projects has slowed down, and the demand recovery is less than expected. According to the digital cement network, the delivery rate in various places has decreased by about 20-25% year-on-year. In order to maintain the balance between supply and demand, the staggered peak production time in many places has been prolonged, and the weak supply and demand has led to the continuous downward trend of cement production in March. We believe that the short-term epidemic disturbance will not change, the demand will gradually increase, and the demand will be delayed but will not be absent. The central bank will reduce the reserve requirement by 0.25 percentage points again to support the recovery of the real economy. In the first quarter, local government special bonds issued 1.33 trillion, an increase of 1.09 trillion year-on-year. Local special bonds were issued in advance to help stabilize growth. The state actively promoted the investment in 102 major infrastructure projects to achieve a better matching and rapid landing of funds and projects, At the same time, due to urban policies, real estate has been substantially relaxed in many places, and real estate demand is expected to hit the bottom and rebound; The real estate and infrastructure chain is still an important part of stabilizing the economy. With the marginal improvement of the epidemic, the subsequent demand is expected to further recover, the cement price will continue to rise, and the cement sector with undervalued value and high dividend will still benefit the most. It is suggested to pay attention to the faucet Anhui Conch Cement Company Limited(600585) , Huaxin Cement Co.Ltd(600801) and the elastic subject Gansu Shangfeng Cement Co.Ltd(000672) .
Glass: the control of Shahe is gradually liberalized, and the pressure of short-term price reduction and destocking remains. The production capacity of glass remained high, so the output maintained a slight increase. However, due to the impact of the epidemic, the demand recovery was less than expected, and the enterprise continued to accumulate inventory and the price was weak. According to Zhuo Chuang information, in the early stage, due to the closed management of epidemic control in Shahe area, the inventory of enterprises continued to rise. Recently, the control was gradually liberalized, and enterprises reduced their inventory by price reduction and promotion; Shipments around Shahe, central China and South China improved, and enterprises went to the warehouse slightly. East China is still affected by logistics and transportation, and the demand side rebounded month on month. Recently, the real estate policies of local governments have continued to relax. Due to the effect of urban policy implementation, the real estate may gradually appear. The orders postponed since the second half of last year may usher in a centralized release. It is optimistic that the volume and price of glass will rise in a new round after the improvement of the epidemic situation. From a macro perspective, the demand for real estate completion remains resilient, with a real estate sales area of more than 1.7 billion square meters in 18-21 years. With the arrival of the housing delivery cycle and the background of guaranteed housing delivery, new construction accelerates the transmission of support demand to completion; At the same time, the industrial chain extension of leading enterprises is gradually emerging, the proportion of growth businesses is gradually increasing, and the periodic fluctuation is gradually smoothed (it is recommended to pay attention to Zhuzhou Kibing Group Co.Ltd(601636) , Csg Holding Co.Ltd(000012) , Xinyi Glass).
Investment suggestion: we believe that the real estate chain and infrastructure chain are an important part of steady growth. The continuous marginal relaxation of policies is conducive to the continuous upward movement of the "foundation" chain. The reversal of the plight of the real estate and large construction industries is more sensitive to the policy. In the near future, we have walked out of the obvious relative income, and the repair market is still sustainable from the policy expectation to the improvement of fundamentals. At present, many places gradually relax the regulation of real estate and improve the transmission from policy expectation to actual demand. The inflection point of real estate fundamentals is gradually approaching, the trend of low before high after real estate is gradually emerging, and the real estate chain will gradually benefit from real estate β Upward; In addition, infrastructure investment remained resilient and continued to improve. At the current time point, in the process of gradually reaching the bottom of the real estate, it is suggested to choose Beijing Oriental Yuhong Waterproof Technology Co.Ltd(002271) , Keshun Waterproof Technologies Co.Ltd(300737) , and pay attention to Zhejiang Weixing New Building Materials Co.Ltd(002372) , so the diversified development of the leader is more promising α Advantages, the industry stabilizes and takes the lead in rebounding; Secondly, focus on the leader Jade Bird Fire Co.Ltd(002960) , which provides one-stop fire service. The logic of expanding categories and increasing market share of the company is similar to that of Guangdong Kinlong Hardware Products Co.Ltd(002791) in 2019. Industrial fire protection can raise the valuation ceiling in the future.
Risk warning: the investment in fixed assets is lower than expected; The aggravation of trade conflict leads to the obstruction of sales volume of export enterprises; The margin of environmental protection supervision is relaxed, and the supply contraction is lower than expected; The sharp rise in the price of raw materials has brought cost pressure.
