[market performance] last Friday, the CSI 300 index closed at 401325 points, down 4.2% on a weekly basis; The Shanghai Composite Index closed at 3087 points, down 3.9% this week. CITIC machinery industry fell 4.9% this week, ranking 17th; Year to date decline of 29.0%, ranking 26th. The subdivided industries generally fell last week. The top five with smaller declines were photovoltaic equipment (- 0.3%), rail transit (- 1.7%), detection (- 1.9%), agricultural machinery equipment (- 2.3%) and metal products (- 2.3%), and laser processing equipment (- 13.6%) had the largest decline.
[key information] 1) 2022q1 national economic operation data: gdp27 02 trillion yuan, a year-on-year increase of 4.8%; The added value of industries above designated size increased by 6.5% year-on-year; The investment in fixed assets was 10.45 trillion yuan, a year-on-year increase of 9.3%; Broad infrastructure investment increased by 8.5%, manufacturing investment increased by 15.6% and real estate development investment increased by 0.7% year-on-year. (National Bureau of Statistics) 2) Q1 national power industry statistics: as of the end of March, the installed capacity of photovoltaic power generation was about 320 million KW, a year-on-year increase of 22.9%, and the new installed capacity was 13.2gw, a year-on-year increase of 148%. (National Energy Administration) 3) in March 2022, the sales volume of bulldozers was 757 units / year-on-year – 30.2%; 29000 lifting platforms / year-on-year + 26.1%; 4198 truck cranes / year-on-year -61.38%. (Construction Machinery Industry Association)
[Key announcement] 1) many companies released annual reports for 2021: ① Sany Heavy Industry Co.Ltd(600031) : revenue 106.87 billion / + 6.8%, net profit attributable to parent company 12.03 billion / – 22.0%; ② Unittec Co.Ltd(000925) : revenue 2.91 billion / – 0.71%, net profit attributable to parent company 200 million / + 255.5%; ③ Leader Harmonious Drive Systems Co.Ltd(688017) : revenue 440 million / + 104.8%, net profit attributable to parent company 190 million / + 130.6%; ④ Hangzhou Chang Chuan Technology Co.Ltd(300604) : revenue of 1.511 billion / + 88%, net profit attributable to parent company of 220 million / + 157.2%. 2) Tuojing Technology: on April 20, it officially landed on the science and innovation board, with an issue price of 71.88 yuan / share, an issue number of 31619800 shares and a fund-raising of 2.273 billion yuan. 3) Suzhou Maxwell Technologies Co.Ltd(300751) : Reliance Industries plans to purchase 8 complete lines of hjt production equipment from Singapore Maiwei, with a capacity of 600MW / piece, a total of 4.8gw. 4) Wuxi Autowell Technology Co.Ltd(688516) : the subsidiary won the bid of “1600 single crystal furnace procurement” project of Yuze semiconductor, with an amount of about 300 million yuan. 5) Contemporary Amperex Technology Co.Limited(300750) : it is proposed to invest in the construction of Xiamen times new energy battery industry base, with a total investment of no more than 13 billion yuan.
[views of this week]
Infrastructure development and marginal relaxation of real estate policies are expected to promote the repair of sector valuation. At present, the construction machinery industry is in a downward cycle. According to CME’s prediction, the sales volume of excavators in April will continue to decline by 43% year-on-year. Under the policy tone of steady growth: 1) infrastructure investment accelerated. In 2022q1, a total of 1.8 trillion yuan of special bonds were issued, with a year-on-year increase of 104%, of which 130 million yuan was newly issued, accounting for about 1 / 3 of the annual quota. The issuance rhythm was significantly accelerated, and the capital investment was mainly concentrated in the field of infrastructure; 2) The marginal relaxation of real estate policy. At present, many indicators such as investment in real estate development, sales and funds in place of real estate enterprises are weak. Since 2022, favorable signals of the real estate industry have been released frequently. Up to now, more than 60 cities across the country have relaxed the regulation, and the policy shows a marginal relaxation trend. We believe that the traditional peak season of the construction machinery industry is expected to move back with the easing of the epidemic, and the sector has experienced a sharp correction in the early stage, which has fully reflected the market’s pessimistic expectation of the industry. Under the expectation of stable growth policy, the infrastructure investment is accelerated and the edge of real estate policy is relaxed, and the industry is expected to usher in a wave of valuation repair market.
In 2022q1, the newly installed capacity of photovoltaic increased by 148% year-on-year, and equipment enterprises have repeatedly won orders. In 2022q1, the newly installed capacity of photovoltaic was 13.2gw, a year-on-year increase of 148%. Driven by the rapid promotion of large scenery bases and the accelerated development of distributed photovoltaic, China’s photovoltaic industry is improving in the medium and long term. According to CPIA prediction, the average annual new installed capacity of photovoltaic in China will be 83-99gw from 2022 to 2025. Driven by demand, the construction of production capacity continues, the demand for equipment is strong, and photovoltaic equipment enterprises have repeatedly obtained orders. Since April, Shenzhen Hymson Laser Intelligent Equipments Co.Ltd(688559) won the order of 1.07 billion TOPCON of Jingke energy, Singapore Maimai won the order of the whole line of production equipment of reliance industrial heterojunction battery, and Wuxi Autowell Technology Co.Ltd(688516) signed a new order of 300 million Yuze photovoltaic single crystal furnace. According to the new installed capacity and orders of photovoltaic equipment enterprises, the prosperity of photovoltaic equipment industry will continue.
As a leader in film deposition, tuojing technology will fully benefit from the industry’s high outlook + domestic substitution. On April 20, tuojing technology landed on the science and innovation board, with an issue price of 71.88 yuan / share, an issue number of 31619800 shares and a raised capital of 2.27 billion yuan, which was invested in technology R & D and improvement projects of advanced semiconductor equipment, ALD equipment R & D and industrialization projects, high-end semiconductor equipment expansion projects and supplementary working capital. The company’s main products include PECVD, ALD and sacvd series, which are applied to the manufacturing line of process integrated circuits with 14nm and above in China’s wafer factories. At present, it is the only manufacturer in China to apply PECVD and sacvd equipment in industrialization. Its products are widely used in the production lines of mainstream wafer factories in China, such as Semiconductor Manufacturing International Corporation(688981) , Huahong group, Changjiang storage, Changxin storage and so on. According to the prospectus, from 2019 to 2020, the number of winning machines for PECVD equipment accounted for 16.7% of the total bidding volume of Changchun, Huali, Wuxi Huahong and Jita, breaking the monopoly of international manufacturers, directly competing with international giants such as Yingcai, Fanlin and Dongdian, and becoming the leading enterprise of film deposition equipment in Chinese Mainland. At present, semiconductor equipment in Chinese Mainland is still in a boom cycle, and the company, as a leading and scarce manufacturer in the field of thin film equipment in China, will fully benefit from the superposition of domestic alternative demand.
Investment advice
Construction machinery: under the expectation of steady growth policy, the infrastructure investment will be accelerated and the marginal of real estate policy will be loosened, and the industry is expected to usher in a wave of valuation and repair market, including Sany Heavy Industry Co.Ltd(600031) , Xcmg Construction Machinery Co.Ltd(000425) , Jiangsu Hengli Hydraulic Co.Ltd(601100) , etc. Photovoltaic equipment: the prosperity of photovoltaic equipment industry will continue, and the industrialization of hjt may be accelerated. The related targets Suzhou Maxwell Technologies Co.Ltd(300751) , Shenzhen S.C New Energy Technology Corporation(300724) , Yingkou Jinchen Machinery Co.Ltd(603396) , etc. Semiconductor equipment: in 2022, the demand for semiconductor equipment in Chinese Mainland will remain high, and local equipment manufacturers will fully benefit from the cultivation of domestic supply chains by Chinese fabs. The related targets are Naura Technology Group Co.Ltd(002371) .
Risk tips
Infrastructure and real estate investment were lower than expected, the epidemic in China continued to spread, the progress of photovoltaic technology upgrading was lower than expected, and the capital expenditure on semiconductor equipment in Chinese Mainland slowed down.
