Key investment points
This week (2022.4.25 – 2022.4.29, the same below): the building materials sector (SW) rose or fell by 1.06% this week. In the same period, the CSI 3 and wandequan a indexes rose or fell by 0.07% and - 1.56% respectively, and the excess returns were 0.99% and 2.62% respectively.
Fundamentals and high-frequency data of bulk building materials: (1) cement: the national high-standard cement market price this week was 502 yuan / ton, compared with - 8 yuan / ton last week and + 39 yuan / ton compared with the same period in 2021. Regions with lower prices than last week: Yangtze River Delta (- 20 yuan / ton), Yangtze River Basin (- 19 yuan / ton), pan Beijing Tianjin Hebei (- 12 yuan / ton), North China (- 4 yuan / ton), East China (- 14 yuan / ton), Central South (- 16 yuan / ton) and Southwest (- 4 yuan / ton). The average cement storage location of the national sample enterprises this week was 67.6%, which was + 1.3pct compared with last week and + 19.1pct compared with the same period in 2021. The average cement delivery rate (daily delivery rate / production capacity in process) of the national sample enterprises was 62.4%, which was -1.33pct compared with last week and -23.0pct compared with the same period in 2021. (2) Glass: according to the statistics of Zhuo Chuang information, the average price of the national float white glass original sheet is 2048 yuan / ton, which is - 5 yuan / ton compared with last week and - 328 yuan / ton compared with the same period in 2021. According to the statistics of Zhuo Chuang information, the original film inventory of sample enterprises in 13 provinces in China was 61.16 million heavy boxes, up from - 660000 heavy boxes last week and + 38.76 million heavy boxes over the same period in 2021. (3) Glass fiber: the median turnover of alkali free 2400tex direct yarn is 6150 yuan / ton, the same as last week and the same as the same period in 2021.
Zhou's view: the finance and Economic Commission and the top-level meeting at the end of April recognized the rationality of relaxing real estate in various places, but also adhered to the bottom line of not speculation in real estate. In April, real estate sales and land transactions, and the delivery of building materials enterprises were weak. However, the relaxation effect of the policy is accumulating. In the process of the gradual recovery of the whole society's confidence in stable real estate, we can see that the growth rate of infrastructure construction continued to rise in March, the infrastructure orders of construction enterprises increased rapidly, and the physical demand of infrastructure construction gradually fell. We believe that with the accumulation of policy relaxation and the retreat of early constraints, the industry fundamentals of the investment chain are closer and closer to the bottom, and the opportunities for building materials are also obvious, especially for materials that benefit from infrastructure construction or construction, such as waterproof materials and cement, which are mainly opportunities for industry leaders, and often enterprises that expand against the trend and take the lead in leveraging at the bottom of the industry. Recommend Beijing Oriental Yuhong Waterproof Technology Co.Ltd(002271) , Keshun Waterproof Technologies Co.Ltd(300737) , Guangdong Kinlong Hardware Products Co.Ltd(002791) , Beijing New Building Materials Public Limited Company(000786) , Zhejiang Weixing New Building Materials Co.Ltd(002372) , Huaxin Cement Co.Ltd(600801) , and pay attention to Gansu Shangfeng Cement Co.Ltd(000672) , Anhui Conch Cement Company Limited(600585) , China Liansu, etc.
In terms of bulk building materials: the policy comprehensively strengthens the infrastructure. In terms of absolute volume, the traditional infrastructure still benefits the most. After the continuous development of fiscal policy since Q4 last year, the recovery of infrastructure investment has begun to transmit to the physical demand. The impact of the epidemic on the construction of key projects will make the demand more concentrated in the third and fourth quarters. It is expected that as the epidemic situation eases, the implementation of infrastructure projects will contribute to the physical demand. The markets along the Yangtze River and the Pearl River Delta with relatively high core capacity utilization and good industry structure are expected to take the lead in seeing the cement price elasticity exceeding expectations. Industry self-discipline + potential environmental protection and energy consumption constraints shrink the supply capacity of the industry. In the medium term, the capacity utilization rate of the industry is expected to remain high, and the profit center will remain medium to high. The dividend yield of 5 ~ 8% in 2021 makes the current valuation of 7 times P / E ratio have room for repair. Recommend Huaxin Cement Co.Ltd(600801) , which has strong performance certainty and bright spots in the extension of medium and long-term industrial chain. It is recommended to pay attention to Anhui Conch Cement Company Limited(600585) and Gansu Shangfeng Cement Co.Ltd(000672) and Tangshan Jidong Cement Co.Ltd(000401) , Xinjiang Tianshan Cement Co.Ltd(000877) , Gansu Qilianshan Cement Group Co.Ltd(600720) , etc. which benefit from the integration of the northern market in the medium and long term.
Decoration and building materials: the annual report and the first quarterly report have been disclosed recently. In 21q4, most enterprises are dragged down by the high cost and impairment provision. In 22q1, most of them are affected by the epidemic and the slowdown of demand, and the performance growth rate is low. Some enterprises that prefer to start materials, such as Beijing Oriental Yuhong Waterproof Technology Co.Ltd(002271) , Keshun Waterproof Technologies Co.Ltd(300737) revenue, perform more prominently. Since the release of Q2, the price of raw materials and decoration materials has been expected to be at a high level, which has been reflected by the sharp rise in the price of raw materials and decoration materials since the release of Q2. Although most enterprises' shipments are affected by the short-term epidemic, some front-line leading enterprises have a high order growth rate. With the expectation of marginal relaxation of real estate, the decline of high raw material costs, the gradual release of bad debt provision and cash flow risk expectation, the overall sector is expected to usher in performance and valuation repair. Referring to the historical experience of the consumer building materials sector and the current competitive situation, in the stage of capital easing + confidence gradually recovering from the bottom of the real estate industry, some companies may take the lead to further increase their share and enter a new expansion cycle with the help of channel leading layout, operating efficiency advantage or financing plus leverage. The inflection point of shipment or order growth can be used as a signal on the right. Recommend Guangdong Kinlong Hardware Products Co.Ltd(002791) , Beijing Oriental Yuhong Waterproof Technology Co.Ltd(002271) , Keshun Waterproof Technologies Co.Ltd(300737) , Beijing New Building Materials Public Limited Company(000786) , Zhejiang Weixing New Building Materials Co.Ltd(002372) , Monalisa Group Co.Ltd(002918) , Jiangsu Canlon Building Materials Co.Ltd(300715) , and it is suggested to pay attention to China Liansu, ad Co., Ltd., Zhejiang Walrus New Material Co.Ltd(003011) , etc.
Risk warning: the epidemic situation exceeded expectations, the real estate credit risk was out of control, and the policy concentration exceeded expectations.
