Sany Heavy Industry (600031) Annual Report Comment: Profit Growth Growth Leads Outstanding Value

Sany Heavy Industry (600031) Annual Report Comment: Profit Growth Growth Leads Outstanding Value

Investment highlights: Sany Heavy Industry disclosed annual report: 2018 revenue of 558.

2 ten percent, an increase of 45 per year.

6%; net profit attributable to mother 61.

2 ten percent, an increase of 192 per year.

3%; budget benefit 0.

73 yuan (after the latest diluted share capital).

A cash dividend of 2 per 10 shares is proposed.

60 yuan (including tax).

Ping An’s point of view: The sharp increase in profit is in line with expectations, and the operating efficiency continues to improve: in 2018, it achieved revenue of 558.

2 ppm, an increase of 45 in ten years.

6%; net profit attributable to mother 61.

20,000 yuan, an increase of 192 in ten years.

3%; basically in line with democratic expectations.

2018 preliminary gross profit margin 30.

6%, 0 higher than the previous year.

5 levels, showing strong market demand and excellent market competitiveness of the company’s products.

Expense rate during the year 2018 was 15.

02% (including R & D expenses), a decrease of 5.

The average of 03, the improvement of operating efficiency, contributed to the net increase and growth.

2018 net margin 11.

3%, an increase of 5 over the previous year.

5 averages.

It is also worth mentioning that the company achieved international sales revenue of 136 in 2018.

27 ppm, an increase of 17 in ten years.

29%, the global competitiveness and popularity of the company’s products are rapidly increasing, and export trade has opened up new space for the company’s growth.

In the first quarter, construction machinery was well-received, and strong demand continued to exceed expectations. According to the China Construction Machinery Association, in February 2019, a total of 1 excavators were sold.

870,000 units, a year-on-year increase of 69%; total sales from January to February3.

50,000 units, a year-on-year growth of 40%, greatly exceeding market expectations.

Among them, from January to February, small, medium and large excavations increased by 51%, 38%, and 13%, respectively.

The main beneficiaries are: (1) the increase in construction area of the real estate industry; (2) the steady growth of infrastructure construction policies, which has gradually driven the growth of excavator sales.

Looking ahead to 2019, we believe that the sales of previous construction machinery are still expected to grow steadily, and Sany Heavy Industry, which is the industry leader, will continue to benefit.

The overall leader is stable and the market share is constantly increasing: According to the data of the Construction Machinery Association, in February 2019, Sany Heavy Industry sold 5,060 excavators, and the market share increased to 27%. The industry leader has continued to consolidate.The concentration of foreign enterprises will continue to be one of the important trends in the development of the construction machinery industry in the future, and Sany’s market share will still have room for improvement.

Profit forecast and investment advice: The company is a leader in the construction machinery industry in developing countries.

The downstream demand continued to exceed expectations, the company’s leadership level was stable, and its market share was constantly increasing. Overseas trade opened up new space for the company’s growth.

Taking into account the continued strong downstream demand, changing the re-forecast of financial expenses and management expenses, adjusting the forecast of the company’s performance, is it expected that 2019?
2021 earnings (after diluted share capital) are 0.

97, 1.

25 yuan (the previous values for 2019-2020 are 0.
71 yuan, 0.

75 yuan), corresponding to PE are 13.

2, 11.

2, 10.

Maintain the “Recommended” level.

Risk reminders: (1) 北京夜网 Real estate and infrastructure investment growth is relatively short-term: real estate and infrastructure construction are the two most important downstream industries of construction machinery, and their investment growth directly affects the boom of construction machinery; if real estate and infrastructure investment grows rapidlyAt least, (2) the increase in the price of raw materials affects the company’s product gross profit margin: steel prices, hydraulic components and other raw materials expand the proportion of construction machinery costs, if the steel price increases, and the company’s products do not have a corresponding increase in price,Interest rates may change; (3) Risk of exchange rate changes: In 2017, the company ‘s overseas business income exceeded US $ 10 billion, and it will continue to grow in the future. If 杭州夜网论坛 the US dollar exchange rate rises and fluctuates sharply, the exchange losses generated will affect the company’s performance.