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Investment strategy for the manufacturing industry in the second half of 2020: high-quality Chinese manufacturing supply, new opportunities for high-q

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Update time : 2020-06-09 12:24:40
Under the impact of the global epidemic, it not only reflects the advantages of China's manufacturing industry, but also puts forward new development issues and challenges.

We believe that seizing the "engineer dividend" and achieving high-quality development from "Made in China" to "Made in China" is the key. We look for investment opportunities from the two dimensions of demand recovery and supply optimization. Recommendations: white electricity, construction machinery, heavy trucks, auto parts, lithium battery industry chain, photovoltaics, military new materials, etc.

The impact of the global epidemic has brought new challenges and opportunities to China's manufacturing industry. In the process of epidemic prevention and anti-epidemic this year, China's manufacturing industry has demonstrated its super-fast response capabilities, as well as the system advantages brought by a sound and perfect industrial chain layout. At present, China's manufacturing value-added has accounted for more than 25% of the world, but under the "inverse globalization" public opinion caused by the epidemic, it also poses new challenges to the Chinese manufacturing industry and raises new issues for the overseas development of high-quality enterprises. . We believe that China's manufacturing industry is undergoing a high-quality development process from "Made in China" to "Intelligent Manufacturing in China" and from "Demographic Dividend" to "Engineer Dividend". This year’s “Government Work Report” also clearly stated, “Promote the upgrading of manufacturing and the development of emerging industries. Support the high-quality development of manufacturing. Significantly increase medium- and long-term loans for manufacturing. Develop industrial Internet, promote smart manufacturing, and cultivate emerging industrial clusters.”

The recovery of traditional downstream demand and the acceleration of emerging demand will support the recovery of the manufacturing industry. With the resumption of production and normalization of production, it is expected that the demand for white electric appliances, kitchen appliances, passenger cars, spare parts, photovoltaics, etc. will gradually recover, and the annual growth rate will show a trend of low before high. At the same time, under the stimulation of counter-cyclical adjustment policies, construction machinery, heavy trucks, etc. have shown rapid growth of more than 30% in the second quarter so far. It is expected that strategic emerging fields such as new energy vehicles, energy internet, and military new materials will also show rapid growth in the second half of the year. . In addition, under the impact of the epidemic, “house economy”, “contact-free” and other emerging product categories have shown explosive growth. For example, the “explosive products” of small household appliance brands such as Xiong Xiong and Mofei through emerging channels are frequent and online. Revenue accounted for more than 90%; the demand for unmanned delivery robots, sweeping robots, electric treadmills, etc. increased rapidly.

The optimization of the supply-side pattern will bring continuous investment opportunities to China's manufacturing industry. The impact of the epidemic impact is equivalent to the supply-side reform caused by external forces, which has further increased the concentration of industries in all walks of life, and the pricing power of leading companies has become increasingly obvious. For example: the rare price increase phenomenon of construction machinery, CR4 of heavy truck industry is close to 80%, CR4 of power battery, negative electrode, separator, electrolyte and other industries is close to 70%. At the same time, from a global perspective, orders are moving closer to Chinese companies that resume production earlier. For example: China's air ice washing production has accounted for 94%, 46%, and 43% of the world respectively; power batteries and lithium battery materials have fully entered the overseas mainstream supply chain; auto parts companies have moved from "import substitution" to "global substitution". However, it also puts forward higher requirements on the global production capacity layout and overseas operation capabilities of such Chinese companies.

Risk factors: The consumption environment continues to be sluggish, and sales of home appliances, passenger cars, and new energy vehicles are lower than expected; new and old infrastructure investment, lithium battery equipment investment, oil and gas equipment investment, and industrial automation investment are lower than expected; UHV approval progress is lower than expected ; PV demand is lower than expected; state-owned enterprises in the military industry reform progress is lower than expected; raw material prices fluctuate significantly.

Investment strategy: Under the impact of the global epidemic, it not only reflects the advantages of China's manufacturing industry, but also puts forward new development issues and challenges. We believe that seizing the "engineer dividend" and achieving high-quality development from "Made in China" to "Made in China" is the key. Our normal recovery from the demand side (home appliances, passenger cars, parts, photovoltaics, etc.), the accelerated release of some of the demand under the counter-cyclical adjustment policy (construction machinery, heavy trucks, new energy vehicles, energy internet, new materials for military industry) and emerging demand The three perspectives of the outbreak (small appliances, service robots), combined with the optimization of the supply side (engineering machinery, heavy trucks, power batteries, lithium battery materials), and the increase in global shares (home appliances, power batteries, lithium battery materials, automotive parts) Dimension, to find the investment field of the greatest common divisor, such as: white power, construction machinery, heavy trucks, auto parts, lithium battery industry chain, photovoltaic, military new materials, etc.
https://www.infignos.com/templates/updatelistingnow.cfm?email=ryanlee901213@gmail.comShenzhen Kangda Precision Manufacturing Co.,Ltd.,Machining Manufacturer,Shenzhen,FL