Key investment points:
Market review. As of April 22, 2022, CITIC’s basic chemical industry fell by 5.96% this week, underperforming the CSI 300 index by 1.77 percentage points, ranking 21st among CITIC’s 30 industries; CITIC’s basic chemical industry fell 10.77% this month, underperforming the CSI 300 index by 5.81 percentage points, ranking 19th among CITIC’s 30 industries. Specific to the three-level sub industries of CITIC basic chemical industry, from the performance of the recent week, the top five sectors are polyester (+ 0.69%), pesticide (- 1.46%), potassium fertilizer (- 1.78%), daily chemicals (- 2.36%) and fluorochemical (- 2.51%); From the performance of the last week, the top five sectors of decline were phosphate fertilizer and phosphate chemical (- 10.23%), synthetic resin (- 9.70%), chlor alkali (- 9.59%), titanium dioxide (- 9.54%) and soda ash (- 8.91%). Among the stocks with the highest gains this week, Cybrid Technologies Inc(603212) , Nanjing Chemical Fibre Co.Ltd(600889) and Jiangsu Lopal Tech.Co.Ltd(603906) performed best, with gains of 20.94%, 15.98% and 15.47% respectively. Among the stocks with the highest decline this week, Yangmei Chemical Co.Ltd(600691) , Aba Chemicals Corporation(300261) and Jiangsu Boiln Plastics Co.Ltd(301003) performed the worst, with declines of – 21.54%, – 20.35% and – 20.11% respectively.
Rise and fall of chemical products: among the key monitored chemical products, the products with the top five price increases this week are liquid chlorine (+ 19.17%), DMF (+ 11.51%), coal tar (+ 8.81%), coke (+ 5.66%), xylene (+ 4.15%), and the products with the top five price decreases are trichloroethylene (- 24.16%), acetic acid (- 9.09%), aniline (- 7.66%), dimethyl ether (- 3.79%) and natural rubber (- 3.02%).
Weekly view of basic chemical industry: the Russian Ukrainian war is short-term or difficult to end, the price of crude oil and international grain fluctuates, the price of international chemical fertilizer remains high, and China’s potash fertilizer is highly dependent on foreign countries. It is suggested to pay attention to Asia-Potash International Investment (Guangzhou) Co.Ltd(000893) ( Asia-Potash International Investment (Guangzhou) Co.Ltd(000893) ); At present, the price difference of phosphate fertilizer outside China is large. If China’s export is liberalized after spring ploughing, the profits of Chinese phosphate fertilizer enterprises may improve. It is suggested to pay attention to Yunnan Yuntianhua Co.Ltd(600096) ( Yunnan Yuntianhua Co.Ltd(600096) ), Hubei Xingfa Chemicals Group Co.Ltd(600141) ( Hubei Xingfa Chemicals Group Co.Ltd(600141) ), Hubei Yihua Chemical Industry Co.Ltd(000422) ( Hubei Yihua Chemical Industry Co.Ltd(000422) ), etc. Recently, the real estate regulation policies in many places have been relaxed, and the demand for photovoltaic glass is relatively strong. We can pay attention to the company Inner Mongoliayuan Xing Energy Company Limited(000683) ( Inner Mongoliayuan Xing Energy Company Limited(000683) ) in the field of soda ash, the raw material upstream of glass. In addition, it is suggested to pay attention to the tire enterprises Qingdao Sentury Tire Co.Ltd(002984) ( Qingdao Sentury Tire Co.Ltd(002984) ) that have increased the transmission cost pressure and are mainly in overseas replacement demand. The medium and long-term fundamentals of industry leading companies are stable. It is recommended to pay attention to Wanhua Chemical Group Co.Ltd(600309) ( Wanhua Chemical Group Co.Ltd(600309) ), Jiangsu Yangnong Chemical Co.Ltd(600486) ( Jiangsu Yangnong Chemical Co.Ltd(600486) ), Shandong Hualu-Hengsheng Chemical Co.Ltd(600426) ( Shandong Hualu-Hengsheng Chemical Co.Ltd(600426) ), Anhui Jinhe Industrial Co.Ltd(002597) ( Anhui Jinhe Industrial Co.Ltd(002597) ), etc.
Risk warning: the fluctuation risk of energy price and international grain price caused by the uncertainty of Russia Ukraine conflict; Risk of narrowing the price difference of chemical products due to sharp fluctuations in oil prices; Under the background of stable supply and price, the export of some chemical fertilizers in China is limited; The policy of ensuring supply and stabilizing price of chemical fertilizer leads to the risk that the price of chemical fertilizer drops more than expected; If macroeconomic pressure leads to the risk that the downstream demand of chemical products is lower than expected; Risk of deterioration of supply and demand pattern due to the rapid release of new capacity of some chemical products; The risk of intensified industry competition; The relaxation of real estate policy is less than the expected risk; Natural and man-made disasters and other force majeure events.
