建筑：化债助力建筑企业业绩估值双修复

Investment Rating - The report maintains a "Buy" recommendation for the construction industry [6]. Core Insights - The construction industry's business activity index slightly declined to 50.4% in October, with new orders index rising to 43.5% [2][3]. - Infrastructure investment growth accelerated, with broad infrastructure investment growth at 9.35% and narrow infrastructure investment growth at 4.3% for the first ten months of 2024 [2][44]. - Real estate investment faced pressure, with a 10.3% year-on-year decline in development investment, although the rate of decline in sales and new construction areas has narrowed [3][59]. - Debt relief policies have been introduced, significantly reducing the pressure of hidden debts for local governments, which is expected to benefit construction companies [3][68]. Summary by Sections 1. Construction Industry Activity - The construction industry's business activity index was 50.4%, down 0.3 percentage points from the previous month, while the new orders index increased by 4.0 percentage points to 43.5% [2][15]. - The input price index rose to 55.2%, indicating increased costs, while the sales price index also increased to 52.1% [2][15]. 2. Fixed Asset Investment - Total fixed asset investment (excluding rural households) reached 423,222 billion yuan, with a year-on-year growth of 3.4% [26]. - Private fixed asset investment decreased by 0.3%, while infrastructure investment (excluding power, heat, gas, and water supply) grew by 4.3% [26][44]. 3. Infrastructure Investment - Broad infrastructure investment growth was recorded at 9.35%, with narrow infrastructure investment at 4.3% for the first ten months of 2024 [2][44]. - The report anticipates continued positive contributions from infrastructure investments in stabilizing the economy [44]. 4. Real Estate Market - Real estate development investment totaled 86,309 billion yuan, down 10.3% year-on-year, with a narrowing decline in sales area to 15.8% [3][59]. - New construction area decreased by 22.6%, while the completion area fell by 23.9%, both showing a narrowing decline [3][59]. 5. Debt Relief Policies - The report highlights three key debt relief measures, including an increase of 60,000 billion yuan in local government debt limits over three years [3][68]. - The total hidden debt that needs to be digested by local governments is expected to drop significantly from 14.3 trillion yuan to 2.3 trillion yuan by 2028 [3][68]. 6. Recommendations - The report recommends focusing on three main areas: undervalued high-dividend state-owned enterprises in the construction sector, high-growth international engineering companies, and leading design firms in the low-altitude economy [4].