Machinery biweekly (April 2nd issue)-Six new nuclear power units were approved and landed, and the demand for diamond cultivation reached a record high.
The approval of six new nuclear power units has reached a record high of nearly seven years, and the demand for cultivating diamonds has reached a record high.
Nuclear power: On April 20th, the executive meeting of the State Council approved three new nuclear power unit projects that have been incorporated into the national planning after years of preparation and comprehensive evaluation. Since the restart of nuclear power in 2019, the number of approved units has reached a new high in recent years (4/4/5/6 new units were approved in 2019-2022 respectively). The national attitude towards nuclear power development is positive and clear, and the economy continues to improve. Batch construction+nuclear waste post-treatment opens up the space for nuclear power growth. We are optimistic about the companies with high market share and high proportion of nuclear power business in the nuclear power segment, and focus on the equipment links: Jiangsu Shentong, Yingliu and Zhongmi Holdings.
Cultivating diamonds: In March, 2022, rough diamonds were +157.08% year-on-year and +30.97% month-on-month, and the import volume reached a new record high. The high prosperity of the industry has been continuously verified. We continue to be optimistic about the investment opportunities of cultivating the diamond industry. It is suggested to focus on Zhongbing Red Arrow, Yellow River Cyclone, Power Diamond, Sifangda, etc.
Important data tracking
In the past two weeks, the machinery industry has dropped by 10.32%, which is 300 5.18 percentage points lower than that of Shanghai and Shenzhen. Since 2022, the steel price/copper price/aluminum price index has increased by 8.00%/7.39%/7.13%. In the last two weeks, the comprehensive steel price index/copper price index has changed by -0.20%/+1.80%/-1.18%.
Cultivation of diamonds (GJEPC4 April 16th data): In terms of rough diamond imports, in March 2022, India's cultivation of rough diamond imports amounted to USD 203 million, a year-on-year increase of +157.08% and a month-on-month increase of +30.97%, a record high. In terms of bare diamond exports, in March 2022, India's cultivated diamond bare diamond exports amounted to USD 137 million, up by +59.45% year on year and up by +8.90% month on month.
Industrial robots (data of April 18th, National Bureau of Statistics): From January to March, 2022, the output of industrial robots was 102,500 units, a year-on-year increase of +10.20%.
Machine tools (data of April 18th, National Bureau of Statistics): From January to March, 2022, the output of metal cutting machine tools was -6.05% year on year, and that of metal forming machine tools was +8.00% year on year.
Construction Machinery (data of China Construction Machinery Industry Association on April 22nd): It is estimated that about 26,500 excavators of various types will be sold in April 2022, with a year-on-year decrease of 43%. Among them, the domestic estimated sales volume is 16,500, with a year-on-year decrease of 60%; Estimated export sales volume is 10,000 units, up 82% year-on-year.
Industry key recommendation combination
Key points: China Testing and Testing; Zhongbing Red Arrow, Yellow River Cyclone; Haupt, Baichu Electronics, Green Harmonic, Yirui Technology, Hanzhong Seiki, Guo Mao, Yiheda; Hengli Hydraulic, Zhejiang Dingli; Lianying Laser and Hangke Technology. "Small but beautiful" combination: Four Fonds, Power Diamond; Su test, letter test standard; Jiangsu Shentong and Mingzhi Technology; Silver shares, Huarong shares, Lingxiao pump industry; Rong Rixin, Kelai Electromechanical, and Yi Zhimi.
Industry viewpoint: Focus on the leading companies with high long-term winning probability on high-quality track.
1) Testing service industry with good business model and large room for growth: China Testing and Jiangsu Testing are recommended, focusing on the measurement of broadcasting and television, China Electric Research Institute, National Inspection Group, Electric Research Institute, and information testing standards.
2) Upstream core component companies with growth stage or high prosperity: Haupt, Hanzhong Seiki, Hengli Hydraulic, Baichu Electronics, Green Harmonic, Yirui Technology, Guo Mao Co., Ltd. and Yiheda are recommended.
3) Product-oriented companies with high prosperity: Zhongbing Red Arrow, Yellow River Cyclone, and Power Diamond are recommended.
4) Special/general equipment industry with high prosperity: Lianying Laser, Hangke Technology, etc. are mainly recommended.
