Morning Brief

MarketResearch MorningBrief [October31st,2024] MorningBrief ZHOUJinyu021‐38674924zhoujinyu011178@gtjas.comS0880516080007 Contents TopRecommendations ●BondMarket:BuyoutReverseRepo ●Active(Passive)AssetAllocation:MacroFriendlinessFactor ●WarIndustrySector:UpdateReport ●BuildingMaterialsSector:UpdateReport ●Yongjin(603995):OW,TP@RMB24.84 ●SouthernAirlines(600029):OW,TP@RMB7.74 LatestReports ●XinbaoAppliances(002705):OW,TP@RMB19.35↑ ●HaierSmartHome(600690):OW,TP@RMB36.54↑ ●YingjiaDistillery(603198):OW,TP@RMB76.00↓ ●AnkerInnovations(300866):OW,TP@RMB103.68↑ ●YunnanEnergyInvestment(002053):OW,TP@RMB16.32 ●ShaanxiCoal(601225):OW,TP@RMB29.39↑ ●Kingnet(002517):OW,TP@RMB17.64↑ ●Weixing(002003):OW,TP@RMB16.43↑ ●Jahwa(600315):OW,TP@RMB21.32 ●SongchengPerformance(300144):OW,TP@RMB11.52↑ SectorRatingsoftheMonthMarketStrategyWeeklyViewpoint 本报告内容译自同日发布的简体中文报告《国泰君安晨报》，报告观点及内容如有任何不一致的地方，一律以该简体中文版报告为准。 TopRecommendations BondMarket:BuyoutReverseRepo Buyoutreverserepo,asanewinstrumentofflexibleduration,isacomplementtothemedium‐andshort‐termliquiditytoolsofPBoC.ComparedtoMLF,buyoutreverserepoisabletoassuagetheliquiditystratificationandbetterreflectthefinancingdemand.Intheshortrun,itcanhelptocompensatetheconcentratedmaturityofMLFattheyearend.Inthelongrun,itcanstrengthenPBoC’sabilitytomanipulatetheyieldcurve. Active(Passive)AssetAllocation:MacroFriendlinessFactor WeapplyMacroFriendlinessfactortotheBlack‐Littermanmodelforourglobalmajorassetallocationandsectorrotationstrategies.BytheendofthisSeptember,theannualizedreturnofGlobalMajorAssetAllocationStrategymayreach22.0%.Theannualizedreturnofthenewly‐developedMacroFriendlinessFactorBlack‐Littermanmodelhasreached22.1%,outperformingWINDAllA‐Sharesby23%sincethebeginningof2024.Thismodelsuggestsgoodinvestmentopportunitiesingoldandfinancialsectoratpresent. WarIndustrySector:UpdateReport Thesuccessfulhostingofthe25thChinaSatelliteApplicationConferenceinBeijingandthesuccessfullaunchingofaseriesofsatellitesrecentlymayspeedupthegrowthofChina’ssatelliteinternetindustry.ThisindustryisstillinthepreliminarystageinChina,whosemainbusinessesonlycoversatellitemanufacturingandrocketlaunching.Therelatingindustrialchainwillbethelong‐termbeneficiaries.Offeaturedcompanies,werecommendJonhonOptronic(002179),SpaceAppliance(002025)andGuoboElectronics.OtherbeneficiariesincludeChengchangTech(001270),AerospaceElectronics(600879)andJushriTech(300762). BuildingMaterialsSector:UpdateReport Thecementindustryisnowinfaceofconcentratedlaunchingofindustriespoliciesonproductioncapacityreplacement,overcapacityrestrictionandcarbonemissiontrade.In2024Q4,thedislocationofhighseasonforthefirsttimeinhistoryisexpectedtopushupcementpricesandgrossmargin.Ofconsumerbuildingmaterials,wekeyrecommendationsincludeOrientalYuhongWaterproof(002271),BNBM(000786),WeixingNewBuildingMaterials(002372),Dehuatb(002043),SkshuPaint(603737),ChinaLesso(2128.HK),Keshun(300737),Dongpeng(003012)andMonalisa(002918).Ofcementcompanies,werecommendConchCement(600585),HuaxinCement(600801),CRBuildingMaterials(1313.HK),Tapai(002233)andShangfengCement(000672).Ofglassprocessingandglassfibercompanies,werecommendFuyaoGlass(600660),XinyiGlass(0868.HK),Kibing(601636),ChinaJushi(600176)andSinomaSci&Tech(002080). Yongjin(603995):OW,TP@RMB24.84 [Rating:OW(Prv:OW);TP:RMB24.84(Prv:RMB24.84);MP:RMB18.94;Mkt‐Cap:RMB6925mn] TheCompanyreported2024Q1~3revenueofRMB3.941bn(+12.18%yoy)andnetprofitofRMB584mn(+85.12%yoy),inlinewithexpectation.Ofwhich,theCompany’s2024Q3revenuewasRMB10.644bn(+3.89%yoy)andnetprofitwasRMB156mn(+53.13%yoy).In2024H1,theCompany’snon‐recurringgains/lossesweremainlytheRMB109mnrelocationcompensationfortheCompany’sheadquartersZone‐AinZhejiang.Takingintoaccountthechangeofnonrecurringgains/lossesandtherevivalofindustrialprofit,weraiseourforecastsoftheCompany’s2024‐2026netprofitfromRMB616mn,657mnand748mntoRMB708mn,727mnand821mn,andEPStoRMB1.94,1.99and2.25.WemaintaintargetpriceofRMB24.84and“Overweight”rating. SouthernAirlines(600029):OW,TP@RMB7.74 [Rating:OW(Prv:OW);TP:RMB7.74(Prv:RMB7.74);MP:RMB6.05;Mkt‐Cap:RMB109631mn] TheCompany’s2024Q3resultswerebetterthanexpectation.Fasterairfleetturnoverandwide‐bodiedairplaneshelpedtoreducecosts.Thedemandandsupplykeptonrecovering.Profitmarginmayrisefollowingthemarkdownoffuelprices.AndtheCompanymayresorttobetterearningsmanagementstrategyinfuture.WemaintainourforecastsoftheCompany’s2024‐2026netprofitofRMB1.5bn,5.0bnand9.4bn,andmaintaintargetpriceofRMB7.74.Contrarianinvestmentinthelowseasonisrecommended.“Overweight”ratingmaintained. LatestReports XinbaoAppliances(002705):OW,TP@RMB19.35↑ [Rating:OW(Prv:OW);TP:RMB19.35(Prv:RMB16.00);MP:RMB15.02;Mkt‐Cap:RMB12194mn] Despitethehugeamountofexportorders,domesticsalesrevenuewentdownin2024Q3duetoslackdomesticdemandforsmallappliances.Accordingly,welowerourforecastsoftheCompany’s2024‐2026EPSby4%,0.01%and0%fromRMB1.34,1.47and1.64toRMB1.29(+7%yoy),1.46(+13%yoy)and1.64(+13%yoy).TakingintoaccounttheCompany’spositionasaleadingOEMandtherecoveryofsectorvaluationthankstogovernmentsubsidieso