Sany Heavy Industry (600031): Rising cycle and market share increase in the beneficiary industry
We believe that the growth of Sany Heavy Industry is supported by a series of favorable factors, including: (1) the rebound in excavator sales in June; (2) the company’s strong execution and market share continued to increase; (3) the sales growth of cranes and concrete machinery continued to be strong.
At present, it is equivalent to 11 times the forecasted price-earnings ratio in 2019. We believe this is a reasonable level, mainly because we believe that the upward cycle will continue under the stringent environmental protection policy and the need to update and 苏州桑拿网 replace.
Excavator sales rebounded in June.
According to the China Construction Machinery Industry Association, sales of excavators (25 major manufacturers in China) fell around May 2.
After 2%, it increased by 6 in June from a year earlier.
6% to 1.
The only drop in the US in June was 0.
3%, earlier than 5 in May.
An 8% decline is better.
Exports remained strong in June, with sales up by 56% at the most. Both expansion and absolute figures were the highest levels year-to-date.
In the first half of 2019, excavator shipments increased by 14 per year.
We believe the sales progress is satisfactory and is expected to meet our expected growth rate of 15%.
It is expected that Sany’s market share will continue to increase.
Chinese excavator manufacturers have been increasing their market 西安耍耍网 share for a long time.
We believe that the improvement of product quality, precise market strategy and excellent execution ability are the main factors that have caused Sany to become a market winner.
Sany’s excavator market share rose from about 12% in 2011 to about 26% in the first five months of this year, far exceeding all major associations.
Driven by industry growth and increasing market share, Sany Heavy Industries aims to achieve sales growth of more than 20% in 2019.
Cranes and concrete machinery have exploded.
According to our understanding, the sales volume of Sany ‘s lifting machinery increased by 100% every year in the first half of 2019, far higher than the average of the industry by 50-60%.
In terms of concrete machinery, Sany’s pump truck sales have increased by 100% every year.
The company is particularly bullish on this market segment as the overall overall demand is driven entirely by the need for replacement.
We estimate that Sany Heavy Industry will continue to achieve growth that is much higher than the industry average.