This week's special topic: how to treat the subsequent restless market in spring?
According to the investment data, in December, the investment in real estate development / narrow infrastructure / broad infrastructure / manufacturing industry was - 13.9% / - 0.6% / + 3.8% / + 11.8% year-on-year respectively. The downward pressure on the economy increased. We believe that the demand for steady economic growth in 22q1 may be stronger than that in the past five years. On the premise of the acceleration of special bonds, the advance of Finance and the sufficient reserves of major projects, it is expected that the growth rate of infrastructure in 22q1 is expected to improve significantly month on month, The year-on-year growth rate in a single quarter may exceed 5%. Although the overall elasticity of infrastructure construction in the whole year of 22 years is limited, the subdivided areas such as Shandong, Sichuan and Chongqing, and the subdivided fields such as green power, affordable housing, pipe network, cold chain and major transportation are expected to show good growth sustainability and elasticity.
On the policy side, on January 18, Yuan Da, director of the comprehensive Department of national economy of the national development and Reform Commission, said at a press conference on January 18 that we should speed up the introduction of a series of policies and measures to implement the strategy of expanding domestic demand. Timely study and put forward targeted measures to revitalize industrial operation. Carry out infrastructure investment appropriately in advance, accelerate the promotion of 102 major engineering projects in the 14th five year plan, implement the special bonds issued by local governments in the fourth quarter of last year to specific projects as soon as possible in accordance with the requirements of "funds follow projects", pay close attention to the amount issued, and strive to form more physical workload in the first quarter; Last week, the Ministry of housing and urban rural development held a working meeting, which specifically pointed out the need to fully release the potential of residents' housing demand. The subsequent demand side regulation policies may be loosened, and the demand side outlook is expected to usher in a recovery; In terms of affordable housing, it is required to continue to promote the structural reform of housing supply side, and it is clear that 2.4 million affordable housing units will be built in 2022; We judge that the real estate fundamentals are expected to gradually hit the bottom and rebound, and the improvement trend of the policy side may continue. In addition, the State Council Information Office held a press conference on financial statistics last week, which mentioned "opening the monetary policy toolbox wider", "taking the initiative to find good projects", "moving forward" and so on, which further released a positive signal of steady growth. At the current time point, we continue to be optimistic about the restless spring market of undervalued blue chips driven by steady growth.
Market Review
Last week, the construction (CITIC) index rose 3.38% and the CSI 300 index rose 1.11%. The infrastructure and housing construction sectors with the majority of blue chips from central enterprises in the tertiary sub sector led the gains, recording positive gains of 7.09% and 4.84% respectively. Among the stocks, Huitong group (+ 60.93%), Shanghaichengdiconstructioncorporationltd(603887) (+ 28.71%), Lingnan Eco&Culture-Tourism Co.Ltd(002717) (+ 28.61%), Hongrun Construction Group Co.Ltd(002062) (+ 14.69%) and Power Construction Corporation Of China Ltd(Powerchina Ltd)(601669) (+ 13.56%) led the increase.
Investment advice
Under the medium and long-term growth dimension of "construction +" leader, enterprises with "new energy" and "chemical" industries have gradually entered the performance cashing period, and their performance is expected to grow high. Under the dimension of valuation restoration of value varieties, the leaders of local state-owned enterprises are expected to enjoy the high boom of regional infrastructure. The profit elasticity brought by the improvement of operating efficiency has initially appeared. There are both opportunities for steady growth and report quality improvement in the medium and long term. The increase of market share of central enterprises supports the continuous growth of revenue. After the completion of leverage reduction, roe still has obvious upward elasticity, With the continuous strengthening of the profit release ability and willingness of central enterprises, they also have strong elasticity of valuation repair.
Risk tips: Infrastructure & real estate investment went down more than expected, new energy & chemical business expansion was less than expected, the concentration of assembled leaders was less than expected, and the progress of efficiency improvement in the reform of central enterprises and state-owned enterprises was less than expected.
