Follow up comments
On January 17, 2022, the Shanghai Composite Index closed at 3541.67 points, up 0.58%; The Shenzhen Component Index closed at 14363.57 points, up 1.51%. The Chongqing composite index, which we focus on, closed at 3762.33 points, up 0.85%; Sichuan composite index closed at 9359.58 points, up 0.84%. The top three stocks of Listed Companies in Sichuan and Chongqing are: Jiayuan Technology (301117, 75.19%), Troy Information Technology Co.Ltd(300366) (300366, 16.71%), Eoptolink Technology Inc.Ltd(300502) (300502, 11.25%). The 42 companies we focused on rose by an average of 1.73%, of which the top three stocks were: Eoptolink Technology Inc.Ltd(300502) (300502, 11.25%), Sichuan Tianyi Comheart Telecom Co.Ltd(300504) (300504, 10.57%), Sichuan Jiuyuan Yinhai Software Co.Ltd(002777) (002777, 7.87%). By industry, the top three sectors in Sichuan and Chongqing are computer (+ 12.08%), communication (+ 7.54%) and household appliances (+ 4.55%).
According to the data of the National Bureau of statistics, in 2021, the per capita consumption expenditure of residents in the province was 21518 yuan, a year-on-year increase of 8.8%, an average increase of 5.5% over 2019. Among them, the growth rate of per capita consumption expenditure of rural residents was 2.7pct higher than that of urban residents. In terms of specific categories, affected by the decline in pork prices, the per capita expenditure on food, tobacco and alcohol of urban residents increased by 5.8% year-on-year, accounting for 34.3% of the consumption expenditure of urban residents, a decrease of 0.5 percentage points over the previous year; Rural residents increased by 9.0% year-on-year, accounting for 36.3%, down 0.3 percentage points. In addition, affected by the double reduction policy, the growth rate of education expenditure in the province fell. In 2021, the per capita education expenditure of all residents increased by 14.6% year-on-year, but decreased by 10.5pct compared with 2019, with an average growth of 2.1% in two years. The stability of the overall price of food, tobacco and wine and the decline of pig price are conducive to reducing the proportion of residents’ rigid demand for consumption. Superimposed on the decline of residents’ investment in education under the “double reduction” policy, it will further release the consumption potential of residents in Sichuan and Chongqing, help consumption upgrading, and provide development opportunities for enterprises in the consumption industry in Sichuan and Chongqing to realize high-end and diversification.
Industry dynamics
According to the data of the National Bureau of statistics, 63.148 million pigs were sold in Sichuan Province in 2021, a year-on-year increase of 12.5%. At the end of the year, there were 42.551 million pigs in the province, a year-on-year increase of 9.8%, and the pig production capacity in Sichuan was fully restored. (China News Network)
Company dynamics
Lier Chemical Co.Ltd(002258) (002258): the 2021 annual performance express was released. In 2021, the company achieved an operating revenue of RMB 6.494 billion, a year-on-year increase of 30.70%, and a net profit attributable to shareholders of listed companies of RMB 1.072 billion, a year-on-year increase of 75.17%.
Sunway Co.Ltd(603333) (603333): the announcement on the first phase of the 40000 ton project and the establishment of a joint venture of the integration project of negative materials of 200000 ton power energy storage batteries with foreign investment is issued. The company plans to jointly invest and establish a joint venture with conch venture to build the integration project of negative materials of 200000 ton power energy storage batteries in Leshan high tech Zone, The investment amount of the first phase of the 40000 ton project is expected to be RMB 1.6 billion. Both investors intend to invest with self raised funds and project loans.
Risk tips: economic recovery is lower than expected, covid-19 outbreak risk, raw material price fluctuation risk.
