Market Review
In the current period (from April 18 to April 22), the CSI 300 fell 4.2% and the machinery sector fell 4.9%, ranking 17 among the 28 Shenwan industries. In terms of industry segments, photovoltaic equipment saw the largest increase of 0.9%; Oil and gas equipment fell the most, down 13.4%.
This week's view
Construction machinery is expected to be not light in the off-season, and it is optimistic about the release of demand after the epidemic.
Since March, due to the serious impact of the epidemic, the project commencement and excavator sales have fallen short of expectations, resulting in a sharp decline. However, under the background of steady growth this year, the power of infrastructure construction is very obvious. On April 18, the National Bureau of statistics released data showing that infrastructure investment increased by 8.5% year-on-year. Moreover, according to the financial data released by the central bank in the first quarter, the net financing of government bonds was 1.58 trillion yuan, an increase of 923.8 billion yuan year-on-year, Mainly due to the forward force of fiscal policy, the issuance rhythm of new special bonds in the first quarter was significantly ahead, helping to accelerate the growth of infrastructure investment! Infrastructure investment is an important starting point for the current steady growth. Since March 29, the State Council, the Ministry of Finance and other departments have once again stressed that the issuance and use of special bonds depend on the front. In addition, the deregulation of the real estate policy is obvious. Now many places in the country have liberalized the purchase restriction policy. It is expected that under the pressure of steady growth, more cities will follow up the deregulation to promote market recovery. We believe that as the epidemic situation is gradually controlled in the later stage, a large number of infrastructure projects will be implemented, and the expectation of stabilization and recovery of real estate is also very obvious. It is judged that the construction machinery industry is only behind the demand in the peak season. Coupled with the low base in the same period last year, the growth rate of excavator sales after May is expected to be positive year-on-year, and the construction machinery sector is expected to be not weak in the off-season!
Investment suggestions:
We believe that as the epidemic situation is gradually controlled, the construction machinery sector is expected to remain in the off-season and the demand will be gradually released. We recommend Sany Heavy Industry Co.Ltd(600031) , Jiangsu Hengli Hydraulic Co.Ltd(601100) , Zoomlion Heavy Industry Science And Technology Co.Ltd(000157) , Xcmg Construction Machinery Co.Ltd(000425) , Yantai Eddie Precision Machinery Co.Ltd(603638) , Zhejiang Dingli Machinery Co.Ltd(603338) , Shaanxi Construction Machinery Co.Ltd(600984) , etc!
Risk tips
Macroeconomic fluctuations, external demand fluctuations.
