麦格理中国宏观策略刺激之路进行中20199631页

Pleaserefertopage29forimportantdisclosuresandanalystcertification,oronourwebsite:Bloomberg,MacquarieResearch,Sep2019InsideMaterials–StrongCementShipmentinGD2Machinery–strongsalespickupinAug/Sept6Gasdistribution-infrahikeboostdemand8Power-REinstallationtorushfrom4Q1910Oil&Gas–boostinglowertiercitiesoilinfra12ChinaBanks–ConsumerCreditabeneficiary15Property–benefitsfromspill-overliquidity16ChinaResourcesCement(1313HK)20AnalystsMacquarieCapitalLimitedDavidChing,[e-mail][e-mail][e-mail],[e-mail][e-mail],[e-mail],[e-mail][e-mail][e-mail]ed,[e-mail]hLevel3stimulusisunderwayKeypointsMacquarie’sbasecaseviewisforChina’sLevel3stimulustostartinthenexttwoquarters.However,ourlatestchannelchecksacrossseveralindustriessuggestastealthLevel3stimulusmayalreadybeunderway.Weseepositivesignalsacrossthebasicmaterials,machinery,utilities,andenergysectors.Topbuyideas:CRC,Hengli,COSL,CRGas,LongyuanChannelcheckssuggestaStealthLevel3StimulusisunderwayUsingMacquarie’sChinaeconomiststimulusframework,webelieveaLevel3stimulus(majorinfrastimulus/liquidityloosening)islikelywithinthenexttwoquarters.However,ourlatestchannelcheckssuggestastealthLevel3stimulusmayalreadybeunderway.Thisreportlistsseveralbottom-upindicatorsacrossdifferentindustries,whichwebelieveareleadingsignals.Wehavenotedastronger-than-usualpickupincementshipment,excavatorsales,power/gasconsumption,boostingoilretailinfrainlower-tiercities,etc.Webelievethefocusisoninfraprojects(ratherthanpropertyasinpreviousyears)andweseeCRC,Hengli,COSL,CRGasandLongyuanaskeybeneficiaries.Basicmaterials:Strongpick-upincementshipmentinGuangdongWeseeweeklycementshipmentdataasagoodleadingindicatorofinfrademandpick-up.ThestrongestgrowthYTDYoYisinregionswithkeyinfraprojects,e.g.,Beijing-Tianjin-Hebei(BTH)withthekick-offofXionganandShaanxi.Inthepasttwoweeks,shipmentsgrew20%inGuangdong–whereGreaterBayArea(GBA)infraprojectskickedoffinMay–andthekeybeneficiaryisCRCement,whichwenowaddtoourMarqueeBUYlist.Machinery:Meaningfulpick-upinexcavatorsalesinAug/SeptJiangsuHengli’sexcavatorcylinderplantisrunningatfullutilisationagain,withproductionvolumeup35%MoMinAugandisguidedfor+7%MoMinSept.Pick-upindemandhasbeenfromreplacementsaswellaspositiveimpactoftherelaxationofthelocalspecialgovtboundissuanceinJune.Similarly,bothSanyHeavyandZoomlionexpectapick-upinmobilecranesalesafterdeclinesinJuneandJuly.JiangsuHengli,SanyHeavyandZoomlionarekeybeneficiaries.Gasdistribution:InfrahiketodrivedemandandmarginrecoveryChinagasdemandwasstronginJul-19(+12%YoYvs8%inJun).Webelievedistributors’gasdemandwillacceleratein2H19/1H20drivenbyinfrademandpick-upwith51-76%exposuretoC&Iusers.Moregas-relatedfacilityinvestmentin2H19willhelpeasesupplyshortageandmarginpressure.Toppick:CRGas.Power:REinstallationrushtostimulatedownstreamdemandWeexpecttheRenewableEnergy(RE)installation,esp.wind/solar,toacceleratefrom4Q19whichshouldstimulatematerial/machinerydemand.Wind/solardeveloperandequipmentproviderswillbenefit.PreferLongyuanandGoldwind.Oil&gas:Pick-upinoilretailinfrainlower-tiercitiesWenoteapolicyboosttooilretailinfrainlower-tiercitiesviaupstreamcapexandacceleratedformationofnationalpipelinecompany,afterwhichweexpectaresumptioninmidstreamgascapex.Despiteadropinvehiclesales,dieseldemandisstrongduetofreightactivity.PreferCOSLandPetroChina.Banks:Loosenedliquiditytobenefitinfra-leveragednamesmostWebelievebankswillbenefitlessvs.infrafromL3stimulusyetconsumercreditcouldbenefitfromeconomicrecovery.OurtoppickisChinaCITICBank.Property:Benefitsfromspill-overliquidity,gradualstabilisationWebelievethepolicystanceofthecentralgovtremains“propertyisnotforshort-termstimulus”.Yetvaluationscouldreboundifliquidityspillsovertoproperty.CRCHengliCOSLCRGasLongyuan1313HK601100CH2883HK1193HK916HKRatingOPOPOPOPOPTP12.041.014.548.86.1Shpx7.634.69.538.14.5TSR66%19%56%30%38%19EP/E6.323.118.615.97.420EP/E5.919.413.314.56.419EP/B1.25.71.23.10.620EP/B1.14.61.12.70.619EEV/EBITDA3.417.47.27.56.120EEV/EBITDA3.314.86.36.75.619EROE%21%27%6%20%9%19ENetgearing-7%-17%39%-6%119%19Edivyield%7.7%0.9%3.5%2.4%3.8%19EEPS1.201.500.482.400.56vscons.9%10%37%4%-2%20EEPS1.261.780.672.640.65vscons.15%5%40%4%2%MacquarieResearchRoadtoStimulus6September20192Fig1Macquarie’stopstockpicksundera‘stealth’Level3Stimulus–ourtoppicksforeachsectorareCRCement(Materials),JiangsuHengli(Machinery),CRGas(GasDistribution),Longyuan(Power),COSL(Oil&Gas)Source:Companydata,Bloomberg,MacquarieResearch,September2019TickerCompanyNameSectorAnalystMQRatingMktCapADTVPriceTar