Water conservancy investment is expected to accelerate and continue to be optimistic about coal machine next year

Summary of contents: The Ministry of Water Resources and the National Development and Reform Commission have approved or approved 37 projects approved by the central government, with a total investment of approximately 177.5 billion yuan. According to the Central Document No. 1 of 2011, it is clarified that 4 trillion yuan should be invested in water conservancy construction within 10 years, and the average annual amount of 400 billion yuan has not yet been completed. We believe that investment will increase significantly next year.

overseas market:

The average price-earnings ratio of Hong Kong Exchange Industrial Machinery was 17.09 in 2010, with a weekly decline of 3.51%. The average P/E ratio of Japan's exchange industrial machinery was 37.21 in 2010, and the fall rate was 0.72% per week. The average price-earnings ratio in 2010 of the German exchange's industrial machinery was 42.96. Up to 4.91%; the average price-earnings ratio of the British Exchange Industrial Machinery in 2010 was 16.8, a week-on-year decline of 1.78%; the average price-earnings ratio of the US exchange industrial machinery in 2010 was 22.06, a weekly decline of 1.85%.

Market hotspots and investment advice:

Water investment is expected to accelerate from next year:

According to the China Securities Journal, since the beginning of this year, the Ministry of Water Resources and the National Development and Reform Commission have approved or approved 37 centrally approved projects with a total investment of approximately 177.5 billion yuan. According to the Central Document No. 1 of 2011, it is clarified that 4 trillion yuan should be invested in water conservancy construction within 10 years, and the average annual amount of 400 billion yuan has not yet been completed. We believe that investment will increase significantly next year. From the analysis of investment structure, the Ministry of Water Resources has approved and submitted 42 items (including 37 items approved or approved) approved by the National Development and Reform Commission in 2011. The total investment scale is approximately 235.6 billion yuan, of which 3 are project planning and project proposals. There are 7 books, 21 feasibility studies and 11 preliminary design reports. The preliminary planning work will lay the foundation for the vigorous development in the next three years and maintain its optimistic view. Suggestions: Leo (not rated), South Pump (not rated), New Territories Pump (not rated).

Suggest long-term attention to the coal industry:

Sany heavy equipment made a major breakthrough in the Ukrainian coal machinery market, indicating that China's coal machinery manufacturing overseas brand advantage has entered a new stage of development. The research and development of intelligent coal mining equipment for Taiyuan Coal Mining Machinery will hopefully further promote the healthy competition in the industry to make up for the lack of technology in the field of control systems in China. The availability of mobile safety rescue decks for coal mining machinery in Shanxi Province has also proved that the new market's incentive for technological innovation has been effective. We continue to be optimistic about the healthy development of the coal machinery industry. Suggestions: Zheng Coal Machinery (Overweight), Tiandi Technology (Buy), Shandong Mining Machinery (Overweight) and Linzhou Heavy Machinery (not rated).