The hottest steel is waiting for the overall recov

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Three main lines of steel waiting for overall recovery grasp steel opportunities

three main lines of steel waiting for overall recovery grasp steel opportunities

China Construction machinery information

Guide: the industry boom has resumed growth, and the industry profits in July and August have been proved. Due to the implementation of the national power cut-off policy, the profits of listed steel companies exceeded expectations. The pre increased performance of Baosteel and Linggang in the first three quarters increased by more than 100%, becoming the two purest white horses in the steel industry

the industry boom resumed growth, and the industry profits in July and August have been proved. Due to the implementation of the national power cut-off policy, the profits of listed steel companies exceeded expectations. The pre increased performance of Baosteel and Linggang increased by more than 100% in the first three quarters, making them the two purest "white horses" in the steel industry

the main investment in recent 6 days is 1.1 billion yuan

according to the latest statistics of the market research center and wind information, since the National Day holiday, the circulation weighted average share price of ferrous metal (shenwanyi class industry) sector has increased by 11.49%, while the Shanghai Stock Exchange index has increased by 11.88% over the same period, and the weighted average increase of a shares is 12.16%. The ferrous metal sector has underperformed the Shanghai Stock Exchange Index and the overall A shares by 0.39 and 0.67 percentage points respectively

specific stock data show that among the 31 ferrous metal stocks under trading, 12 stocks outperformed the Shanghai Stock Exchange Index in the six trading days after the national day, accounting for 38.71% of the total number of stocks in the industry

from the perspective of main capital flows, large steel companies are sought after by the main force. The net inflow of main capital reached 23 stocks, accounting for 74.19% of the total number of stocks in this sector. The total net inflow of main capital in this sector was 1.102 billion yuan, with an average net inflow of 33.3789 million yuan per share. Among them, the main capital inflow of Baosteel is the highest, reaching 2555. The company plans to introduce 91300 yuan for this project. The remaining seven stocks with a cumulative net inflow of main funds of more than 70million yuan since the 6th are: Hebei Iron and steel, WISCO, Xining Special Steel, Linggang, Masteel, Xinxing cast pipe, Jiuquan Iron and steel Hongxing. According to the latest statistics of wind information, in the mid year report of this year, the industry (industry data are weighted average income) reported earnings per share of 0.2335 yuan, net assets per share of 2.9178 yuan, net cash flow per share from operating activities of 0.1272 yuan, return on net assets of 4.75%; Based on the closing price on October 15, the dynamic P/E ratio of ferrous metal plate is 17.63 times

the excess return depends on the overall recovery of the industry.

since the second half of the year, the domestic steel market has been weak, the price of iron ore has remained high, and the business pressure of enterprises is great. In addition, the government's production and electricity restrictions aimed at energy conservation and emission reduction exceeded expectations, resulting in many enterprises actively or passively reducing production and weakening the demand for raw materials. The elimination of backward production capacity and the "standard operating conditions for the production of the steel industry" have inhibited the rise of the entire steel production capacity, and the demand for raw materials has naturally been suppressed. In August, domestic imported iron ore was 44.61 million tons, a month on month decrease of 6.67 million tons, a year-on-year decrease of 10.21%. In January this year, the national development and Reform Commission approved a number of new and expanded iron ore projects in China, and approved the new iron ore production capacity of more than 22million tons. At present, domestic manufacturers of 3-yuan materials have begun to make efforts. Domestic iron ore production this year may exceed 1.1 billion tons, an increase of more than 20% year-on-year. With the increase of domestic iron ore production, domestic enterprises will reduce their dependence on imported iron ore in the future, but the pricing power will still be in the hands of the three major mines

market analysts believe that in the period when the profits of the steel industry are at the bottom, the emergence of excess returns will depend more on the overall recovery and rotation of the cyclical industry

three main lines grasp the opportunities of steel stocks

Shenyin Wanguo report predicts that the performance of the fourth quarter will rise slightly. At present, Baosteel has slightly increased its product prices in October and November, and it is expected that the price policies of WISCO and Angang will be basically the same, so the average price of products will rise in the fourth quarter. At the same time, the three major mines have announced that the FOB price of the agreement mines in the fourth quarter will decline by about 10%, which will bring about a white increase in the performance of the company, especially the large companies dominated by Changxie mine. But at the same time, the fourth quarter will gradually enter the low season of industry demand, and the cost sharing will also increase in the last quarter as usual, which will lead to different increases in costs

analysts pointed out that "structural adjustment of the steel industry is an important variable." According to the national goal of eliminating backward production capacity, it is planned to eliminate 30million tons of backward iron making capacity and 8.25 million tons of steel-making capacity in 2010. In 2011, another 72million tons of iron making capacity will be eliminated. If these capacities are eliminated on schedule, the supply and demand of steel will move from overcapacity to capacity balance, or even supply will exceed demand. 2011-2012 will be the beginning of the new boom cycle of the industry

RMB appreciation will improve the performance and valuation of the steel industry in terms of cost, export and valuation. The import volume of iron ore is more than 70billion US dollars, and the appreciation of RMB directly reduces production costs. During the appreciation of the yen from 1985 to 1989, the share prices of Japan's major steel companies rose 5-9 times, while the Nikkei index rose only 2 times in the same period

the report believes that driven by energy conservation and emission reduction, the structure of the steel industry has been adjusted and its profitability has been significantly improved. The appreciation of RMB and other factors improve the profitability and valuation of the industry. To maintain the rating of "stronger than the big market" in the steel industry, three types of investment mainlines are recommended: one is companies with large performance flexibility, such as Bayi Steel and Linggang Co., Ltd; The second category is special steel and high-grade plate companies with long-term growth, such as Daye Special Steel, Baosteel and Xinxing cast pipe; The third category is iron ore resource companies that benefit from appreciation

according to foreign media reports

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