Infrastructure recovery is difficult to hedge against the decline of real estate data, with special attention to the decline of real estate completion data again. In December, the capital construction investment was 1.9 trillion yuan, yoy3.5 trillion yuan 8%, up 11.1pct month on month compared with November. Among them, the investment in power / transportation / public utilities is 0.42/0.59/0.88 trillion and yoy8.5 trillion respectively 1% / 7.1% / – 0.3%, the growth rate changed by 9.5/16.6/7.4pct month on month, and the growth rate in the three fields rebounded significantly. In December, the real estate data continued to decline, and no improvement signal has been seen. In December, the starting / completion / sales / land acquisition area of real estate was 1.61/3.27/2.13/0.33 billion square meters respectively, with the growth rate of – 31.1% / 1.9% / – 15.6% – / 33.2% respectively, and the month on month change of growth rate was – 10.1 / – 13.5 / – 1.7 / – 20.7pct respectively. All data showed a trend of continuous decline. The demand for infrastructure construction is the first to pick up under the catalysis of policies, which will stimulate the demand for early cycle products such as waterproof, pipe, cement, water reducing agent and concrete in the field of building materials. However, considering that most of the demand for early cycle products comes from real estate and infrastructure, the recovery of infrastructure is difficult to hedge the sharp decline of real estate. The cement output in December 2021 was 190 million tons, a decrease of 11% at the same time, mainly due to the drag of new construction data of real estate. Among the early cycle varieties, we suggest paying proper attention to PE pipes, whose demand comes from infrastructure and real estate. Other early cycle varieties account for a relatively high proportion of real estate business, and the impact of data decline can not be ignored. We believe that the end of the real estate policy in the fourth quarter of 2021 has appeared, but the real estate policy must rely on market-oriented transmission. It is expected that under this environment, the real estate data will remain at a relatively low level in the next 1-2 quarters. It should be noted that after the completion growth rate returned to 15.4% in November, the data fell again in December. The falling trend of completion data is earlier than we expected. It should be noted that the risk of negative growth in real estate completion in 2022 will have a significant impact on the demand for building materials in the later cycle. We are optimistic that the glass cold repair volume will increase in 2022 and the price is expected to bottom out. However, if the downstream demand such as the completion of the real estate falls sharply, the glass price will also decline.
Market review this week: this week (2022 / 01 / 17-2022 / 01 / 21), the building materials sector (CITIC) index increased by 2.4%, compared with the excess return of CSI 300 was 1.3%. Year to date, the yield of the building materials sector is – 2.7%, compared with 0.6% of the excess yield of Shanghai and Shenzhen 300. Last week, the yield of the preferred portfolio was – 1.0%, compared with the excess yield of the building materials index was – 3.4%, and the cumulative yield / excess yield was – 0.2% / – 8.0%.
Summary of weekly data of building materials: the average price of float glass nationwide this week was 106.5 yuan / weight box, up 0.66% month on month and down 2% year on year. The inventory was 35.58 million weight boxes, down 7% month on month. At present, the manufacturing cost of glass is high, the downward space of price is limited, and the bottom recovery of price is in line with expectations. We believe that the scale of cold repair in the industry is expected to increase and the price is expected to rise in 2022. This week, the average price of national mainstream winding direct yarn was 6200 yuan / ton, unchanged month on month; The average price of electronic yarn was 12250 yuan / ton, unchanged month on month. Glass fiber still maintains a tight balance between supply and demand, and the high price is expected to be maintained. The average transaction price in the national cement market this week is 502 yuan / ton. The cement delivery rate decreased by 9pct to 34% month on month, and the storage capacity increased by 0.5pct to 61.8% month on month. At present, the cement price base is still high. It is suggested to pay attention to the adjustment of clinker along the river after the beginning of spring.
Optimistic about the bottom recovery of glass prices, corresponding to the key recommendations Zhuzhou Kibing Group Co.Ltd(601636) (601636, buy), Csg Holding Co.Ltd(000012) (000012, buy); Under the situation of infrastructure recovery, early cycle products are recommended Sobute New Materials Co.Ltd(603916) (603916, buy), Beijing Oriental Yuhong Waterproof Technology Co.Ltd(002271) (002271, buy), and China Liansu (02128, buy). The glass fiber market continues to improve, and China Jushi Co.Ltd(600176) (600176, buy) is recommended. Preferred combination of Dongfang Building Materials next week: Zhuzhou Kibing Group Co.Ltd(601636) , Csg Holding Co.Ltd(000012) , China Jushi Co.Ltd(600176) , Sobute New Materials Co.Ltd(603916) , Beijing Oriental Yuhong Waterproof Technology Co.Ltd(002271) , China Liansu
Risk tips
The growth rate of infrastructure / real estate investment did not meet expectations, and the price of raw materials fluctuated sharply
