Overall: last week (2022.01.03-2022.01.09), CSI 300 fell 2.39%, Shanghai stock index fell 1.65% and gem fell 6.80%. The basic chemical industry decreased by 3.35%, underperformed the CSI 300 index by 0.96%, underperformed the Shanghai Composite Index by 1.70%, outperformed the gem index by 3.45%, ranking 22nd.
Sector: the new materials index fell 5.73%, and the market performance was slightly stronger than the gem index. Last week, the new materials index fell 5.73%, outperforming the gem index by 1.07% and losing the Shanghai Composite Index by 4.08%. The fine molecule industry in the new materials index sector fell to varying degrees. The top three sub industries were carbon fiber, lithium battery and lithium electrochemical chemicals, and the degradable plastics index fell the least.
Stocks: in the new materials sector, 36 stocks achieved positive returns. The top gainers are: Shenzhen Leaguer Co.Ltd(002243) (+ 9.03%), Dalian Zhiyun Automation Co.Ltd(300097) (+ 8.03%), Shenzhen Jinjia Group Co.Ltd(002191) (+ 6.74%); The stocks with the highest decline are: Shanghai Hiuv New Materials Co.Ltd(688680) (- 20.76%), Guangdong Fangyuan Environment Co.Ltd(688148) (- 17.75%), Red Avenue New Materials Group Co.Ltd(603650) (- 17.09%).
Valuation: as of January 9, 2022, the PE (TTM) of gem is 58.94 times and that of new materials is 40.37 times.
Industry highlights
Bluecrystal micro – organisms completed the B3 round of financing, mainly engaged in New Bio – based molecules and materials
Shandong Shida Shenghua Chemical Group Company Limite(603026) in 2021, the net profit is expected to increase by more than three times, and the capacity expansion is intensively planned.
With a total investment of 10 billion yuan, Ningbo Shanshan Co.Ltd(600884) 200000 tons of lithium battery cathode material project was officially started.
With a total investment of 3 billion yuan, the newly invested biodegradable resin project with an annual output of 500000 tons was started.
Core view
New chemical materials are one of the important directions for the future development of chemical industry. In the context of carbon neutralization, the traditional chemical industry has ushered in a new round of supply side reform, and the growth rate of downstream demand has slowed down. The future competition is mainly reflected in the integration construction, with cost and efficiency as the main competition threshold, and the market share of the industry leader is expected to be further improved. The downstream of the field of new materials is still in the stage of rapid growth. With the improvement of China’s R & D capacity and service capacity and the support of relevant policies, the new chemical material industry will usher in an accelerated growth period. Therefore, we are optimistic about the new chemical material industry.
There is a large space for the substitution of traditional plastics, and the market prospect of biodegradable plastics is broad. At present, in the new material sub industry, the valuation of degradable plastics is low compared with other sub industries, and the industry is still in the introduction period. In recent years, China has actively promoted biodegradable plastics to replace traditional plastics, which has a huge alternative space. Policy promotion is the main driving force for the development of biodegradable plastics in China. With the cost reduction brought by process and technological breakthroughs, it will become the internal driving force for degradable plastics to replace traditional plastics. We suggest paying attention to the biodegradable plastics industry chain, and individual stocks suggest paying attention to industry leaders with leading technology, large potential demand and large room for rise, such as Cathay Biotech Inc(688065) , Kingfa Sci.& Tech.Co.Ltd(600143) .
Risk tips
The risk that the epidemic situation may cause significant market fluctuations; The economy fell sharply; Policy risk; The risk of technology development falling short of expectations.
