NEWS CENTER

The development of leading architectural decoration enterprises is significantly higher than the development speed of the industry


Release time:

Jun 27,2013

As a post-cycle growth industry, the building decoration industry may still maintain a double-digit compound growth rate during the "Twelfth Five-Year Plan" period and will continue to enjoy the dividends of macroeconomic development. In the short term, the negative impact of clean government policies such as real estate regulation and control and suppression of three public consumption on the industry has been basically digested in the second quarter; in the medium and long term, driven by the new urbanization and the upgrading of residents' consumption, there is still a broad incremental and stock demand in the sub-sectors such as residential decoration, subway transportation and urban complex. For listed companies in the industry, enterprises with excellent capital, design, management capabilities and smooth channel expansion will be significantly higher than the industry growth rate, brand and project experience.

As a post-cycle growth industry, the building decoration industry may still maintain a double-digit compound growth rate during the "Twelfth Five-Year Plan" period and will continue to enjoy the dividends of macroeconomic development. In the short term, the negative impact of clean government policies such as real estate regulation and control and suppression of three public consumption on the industry has been basically digested in the second quarter; in the medium and long term, driven by the new urbanization and the upgrading of residents' consumption, there is still a broad incremental and stock demand in the sub-sectors such as residential decoration, subway transportation and urban complex. For listed companies in the industry, enterprises with excellent capital, design, management capabilities and smooth channel expansion will be significantly higher than the growth rate of the industry, and the accumulation of brand and project experience will make the stronger.

Post-cycle growth industries are expected to continue to enjoy the dividends of macroeconomic development. According to the outline of the 12th five-year Development Plan of China's architectural decoration industry, the high prosperity of the industry will continue, and it is a high probability event to maintain a compound growth rate of about 12%. We believe that the public building decoration sub-sector will be higher than the industry average growth rate, while the residential decoration sub-sector is expected to achieve a higher-than-expected growth rate of more than 5%.

The negative impact of short-term policies is basically digested, and medium-and long-term growth is worry-free. After the release of industry data and company order data in the second quarter, negative factors such as short-term real estate regulation and the government's clean government policy have been basically digested. The medium and long-term industry will benefit from the country's infrastructure investment and consumption upgrade, and the growth rate will be more than 3 percentage points higher than the GDP growth rate. Considering that the industry demand is driven by the incremental drive of new urbanization, subway transportation, urban complex development, and residential, commercial real estate, Driven by the improved demand for public construction and other stocks, the double-digit growth rate will be maintained in the next three years.

Industry concentration gradually increased, capital, design, management capabilities will help the leading enterprises stronger. As the top 100 companies in the industry gradually become bigger and stronger, we believe that the industry concentration will increase significantly during the "Twelfth Five-Year Plan" period. Leading companies have obvious advantages in capital chain guarantee, high-end R & D design-driven construction, and comprehensive management of national layout. The process of increasing the market share has not hit the ceiling. It is expected to be twice the average growth rate of the industry and continue to advance by leaps and bounds.

We choose to recommend gold mantis, Yasha shares, Guangtian shares three targets. Gold Mantis is a leader in the building decoration industry integrating capital, design, management and project experience. It has a stable position in the industry, especially with its excellent information project management. The business structure of various sub-sectors of Yasha shares is reasonable and the order management is excellent. Guangtian shares focus on the fine decoration of high-end residential buildings, and the public clothing field is expected to come from behind to promote the release of performance.