The prosperity of ordinary glass in the hottest gl

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Glass industry: the prosperity of ordinary glass is under pressure

in the 2010 annual speech, our judgment on the prosperity of the glass industry is that in the first half of the year, the demand is still stronger than that of foreign fixtures, and the industry prosperity will oscillate at a high level. In the second half of the year, we will face the risk of rapid release of centralized production capacity, but the sharp decline in prices in mid March is somewhat beyond our expectations

for the second quarter, we also maintained the judgment that the glass price oscillated at the current price. As reflected from the micro level after the price reduction, the price had the premise of oscillation and stabilization, but the glass industry faced the risk of excessive growth of new production capacity after the second quarter

although the prosperity of the glass industry is under pressure, the deep processing sub industry of glass, low glass industry, is expected to see explosive growth in the next 3~5 years. At present, the time for participation is ripe. We recommend the rating for this sub industry for the following reasons:

at present, the utilization rate of low glass in China is low. Compared with the utilization of Low-E glass in developed countries, China's Low-E glass market is at the initial stage of development, Compared with the mature markets basically popularized in Europe and the United States, there is still a considerable gap, and the future development space is still broad

civil housing will have a broad market space in the future. With the continuous improvement of the per capita housing consumption level, the sensitivity to the higher cost of low glass will continue to decrease, and the natural growth of the demand for low glass will maintain a relatively fast speed In the context of energy conservation and emission reduction, we expect to boost the rapid growth of industry demand through policies related to building energy conservation. According to foreign experience, policies are the key driving factor for saving fossil energy at the inflection point of industry demand growth

according to the sensitivity analysis we will do later, we determine that the industry is expected to maintain a high growth rate of more than 40% in the next five years, and there are great investment opportunities in the industry

in terms of the selection of investment targets, we mainly recommend CSG:

low-e therefore requires that its framework materials must have a certain rigid production capacity, which is second to none: CSG's engineering glass (offline Low-E) has four production bases in the East, West, North and south, namely Wujiang, Chengdu, Dongguan and Tianjin. The actual maximum production capacity is about 12million square meters. With years of leadership in the field of low glass, It is a well deserved leader in scale and quality at home

speed up of capacity growth: from 2011 to 2012, the company will have five Low-E production lines put into production one after another. At that time, CSG will have a total Low-E capacity of about 24million square meters. The rapid release of capacity will enable the company to maximize the high profits brought by the industry boom

significant advantage in connotation value: the company is a low-E glass production enterprise with the most advanced technology in China. It has the comprehensive R & D strength of independent intellectual property rights to ensure that the company's products can meet the needs of users from multiple angles. At the same time, the production cost is effectively controlled, and it will be in an active position in the future competition We have speculated about the EPS of CSG from 2010 to 2011 and verified through experiments that the accuracy of the mechanical model is 1.0 yuan and 1.3 yuan respectively. We give the company a target price of 30.00 yuan in the next months, which is equivalent to 30 times of PE in 2010 and 23 times of PE in 2011

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