Chemical industry: boom index rose, soda and polyester filament stocks fell
1. Investment suggestion: Focus on high-increment, high-tech targets. This week's Founder Chemicals Climate Index was 113.79, up 0.1 from last week.
In the second half of the year, we believe that we should look for companies that will continue to rise in the second half of 2018 and 2019, and the focus of research will shift from price growth to sales growth, from bulk commodities to high-tech chemicals. In the future, China's chemical companies have no change in the big logic of increasing domestic and even global market share due to technological innovation and cost advantages. At the current time, we focus on Lear Chemical. The technical difficulty and environmental protection threshold of Lithochemistry are higher. Following the downward price of glufosinate, glufosinate will replace the problem of drug resistance. The market space of glyphosate will increase substantially. Lier Chemical has subsequently expanded its capacity by 10,000 tons/year, and each of them has 1,000 tons of epoxiconazole and propargyl flufenacetin, which meets the characteristics of large increments and high technical content, which is highly recommended. On August 17, Lear chemical glufosinate ex-factory price was reported to be 172,000 yuan / ton, the same as the previous month.
We mainly recommend the three major white horses (Wanhua Chemical, Hualu Hengsheng, Yangnong Chemical), the four major refining giants (Rongsheng Petrochemical, Tongkun, Hengli, Hengyi Petrochemical), these seven companies In 2019, both have large product increments, and the expansion of the original main business will further increase the industry concentration and optimize the competitive structure. On August 17th, Wanhua Chemical Pure MDI was listed at 31100 yuan/ton (flat), and the aggregate MDI price was 22,500 yuan/ton (flat), and the aggregate MDI stock was 650 tons (-50 tons). Polyester POY stocks for this week are 0 days (the ratio is flat). The inventory of PTA circulation was 732,000 tons, down by 0.3 million tons. The textile industry's recovery and restrictions on the import of waste plastics led to a surge in demand for polyester and PTA. This is a long-term reversal, and the concentration of PTA and polyester filament industry continues to increase, and the profitability is in a prosperous period in the next two years. Linglong tires are our long-term optimistic target, and Linglong tires will be another rising representative of Chinese manufacturing. The tire industry has both consumer attributes and brand attributes. The growth rate of downstream demand is mainly related to the quantity of cars. The growth is stable. We are optimistic that Linglong tires will gradually form a brand premium through breakthroughs in high-end models and increase the global market share. With over one trillion market space for tires, Linglong has technical advantages and external cost advantages. The production capacity will expand by more than 40% in the next three years. At the same time pay attention to the brand, it is expected to gradually enjoy the brand premium. In 2017, we developed a number of Volkswagen projects, including Volkswagen, Czech Skoda, German Audi, SAIC Volkswagen, FAW Volkswagen, American Volkswagen and Mexican Volkswagen. Bridgestone 205/55R16 耐驰客报330 yuan / article (the ratio is flat).
In addition, soda ash and acetic acid are the industries we have been pushing. These two industries are the reversal of the deterministic capacity cycle. However, due to the impact of the central environmental protection inspectors in June, the downstream demand has fallen sharply, resulting in a decline in product prices. We expect the subsequent downstream to gradually recover, the peak season is more prosperous, soda ash focuses on Shandong Haihua and Yuanxing Energy, and acetic acid focuses on Huayi Group and Hualu Hengsheng.
Acetic acid: This week, Hualu Hengsheng reported 4,850 yuan / ton (+0 yuan / ton), the national inventory for 5 days (about -0.4 days), the recent acetate companies gradually resume production, acetic acid demand will continue to rise. Acetic acid is a reversal of the global production cycle. Foreign equipment is close to the second half of its life. There is no new capacity in China. The domestic downstream PTA is rapidly expanding, focusing on Huayi Group (1.3 million tons/year) and Hualu Hengsheng (500,000 tons). /year).
Soda ash: Shandong Haihua heavy soda ash reported this week at 1825 yuan / ton (0 yuan / ton), the national soda ash inventory 90.4% (390,000 tons, to February 3, 2017, 100%, down 15.1 percentage points on a week-on-week basis) Some soda ash small businesses have begun to raise prices. The price of soda ash has risen sharply for the third consecutive year. The tight balance is to determine the facts. Even if the pessimistic outlook for real estate is made, the operating rate of soda ash will continue to increase in the next three years. Focus on Yuanxing Energy (1.5 million tons of soda ash and 300,000 tons of baking soda) and Shandong Haihua (Ammonia-based method 2.8 million tons / year).
Agrochemicalization is an industry that we have been optimistic since the end of 2017. The downstream demand is relatively independent of infrastructure and real estate, and the rise in oil prices is expected to drive up the price of crops. We recommend the pesticides (Yangonong Chemical, Lier Chemical, Evergreen), We recommend the new Yangfeng, which is undervalued.
Pesticides: Yangnong Chemical, Lier Chemical, Changqing shares. The environmental protection of the supply side continued to be strict, and the demand side rebounded under the pressure of oil prices. Highly recommended genetically modified pesticides such as dicamba and glufosinate: Yangnong Chemical (Fructus and dicamba), Lier Chemical (glyphosate), and Evergreen (the second production capacity of dicamba) ). Glyphosate, imidacloprid, cyhalothrin, bifenthrin, glufosinate, dicamba and other prices are stable.
Compound fertilizer: Hubei Yangfeng Phosphate Monoammonium reported 2400 yuan / ton (stable) this week, July 30 port inventory was 150,000 tons (monthly +00 tons), compound fertilizer ex-factory price 2352 yuan / ton (cycle - 10 yuan / ton), as of the end of July, the inventory was 3.7 million tons (-33% year-on-year), Xinyangfeng is the domestic monoammonium phosphate, and the compound fertilizer business ranks second in China. We are optimistic that oil prices will drive up the price of agricultural products, and the compound fertilizer industry will bottom out. The environmental remediation of the Yangtze River Economic Belt is expected to significantly reduce the production capacity of phosphate fertilizer. The subsequent profitability of phosphate fertilizer is expected to rise under the stimulation of phosphate ore shortage and supply contraction. Xinyangfeng 13 times PE 20 times, only 10 times in 2020, it is highly recommended.
New materials We are optimistic about the continuous expansion of energy, and has a strong technical content of polymer anti-aging agent leader Li Anlong, optimistic about electronic chemicals company Jacques Technology, Jianghuawei, Wanrun shares. The breakthrough in lithium extraction technology will change the global supply pattern of lithium resources. It is recommended to pay attention to the technology side Lanxiao Technology and the resource Fangzang Holdings. Haofeng lithium battery grade lithium carbonate East China offer 97,000 yuan / ton (about -0.8 million / ton).