I. Buying construction stocks amid deleveraging trend..............................................
􀁺 Upgrade to Positive
􀁺 Focus on homebuilders in 1H and overseas players in 2H
􀁺 Leveraged housing business slows, but other units picking up
􀁺 Falling housing sales offset by overseas growth
II. Share performance and valuation..............................................................................
􀁺 Construction shares outperform on government measures
􀁺 Discount fades as sentiment improves
􀁺 Valuation based on ROE and EPS growth
III. Deleveraging to undermine housing market outlook..............................................
􀁺 Liquidity risks fading rapidly
􀁺 But, concerns over homebuilding margins and overall growth persist
􀁺 Deleveraging to undermine growth of housing business
IV. Civil engineering and plants to drive growth...........................................................
􀁺 Civil engineering and plant markets to grow rapidly on stimulus efforts
􀁺 Green New Deal includes W18tn restoration of four major rivers
􀁺 Civil engineering order momentum to grow in 2Q
􀁺 Overseas orders down 46% y-y, but turnaround expected from 2H
􀁺 Oil and other commodity prices recovering
􀁺 Overseas order outlook
[Company Analysis]
Hyundai E&C (Buy, TP W90,600)....................................................................................
Samsung Engineering (Buy, TP W83,000).....................................................................
Daelim Industrial (Buy, TP W82,000)..............................................................................
GS E&C (Buy, TP W81,000).............................................................................................
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