Sany Heavy Industry (600031): 1Q19 Performance Forecast Exceeds Expected Profitability and Continues to Improve

Sany Heavy Industry (600031): 1Q19 Performance Forecast Exceeds Expected Profitability and Continues to Improve

It is forecasted that the annual profit of 1Q19 will increase by 100% -120%. Sany Heavy Industry released the 2019 first quarter performance forecast, and it is expected to achieve a net profit of 30.


0 million yuan, a ten-year increase of 100% -120%, net profit after deduction is 29.


500 million US dollars, an annual increase of 134% -154%, exceeding market expectations, we expect mainly due to the company’s core product market share increased rapidly, profitability increased.

  Focus on the market share increased rapidly.

In the first quarter of 2019, Sany Heavy Industry sold 19,592 excavators, which increased by 52.

3%, significantly higher than the industry average growth rate of about 28ppt; 19Q1 Sany Heavy Industry excavator market accounted for a total of 26.

2%, an increase of 5 percentage points per year.

From January to February 2019, Sany Heavy Industry sold 1,521 truck cranes, an increase of 87 in the future.

5%, market share 26.

3%, an increase of 4 percentage points per year.

Thanks to the improvement of the company’s overall competitiveness in product performance and after-sales service, we expect the company’s market share of excavators, truck cranes and other products to gradually increase; in particular, the domestic market share of CR3 in the excavator market is about 50%, the same as the USSuch as foreign mature market indexes, there is still room for improvement.

  The market share of big mining has increased, the sales structure has been optimized, and profitability has continued to increase.

In the first quarter of 2019, Sany Heavy Industry accounted for 35% of the company’s total excavator sales.

8%, an increase of about 1 percentage point each year.

In particular, the heavy mining market of Sany Heavy Industry in 1Q19 accounted for 26 replacements.

9%, an increase of 4 per year.

6ppt, which is about 6ppt higher than Caterpillar, ranking first in China.

We estimate that the high value, high gross profit margin of large and medium-sized mining companies, and the increase in sales of concrete pump trucks and other products will help the company’s overall gross 四川耍耍网 profit margin continue to improve.

With the manifestation of scale effects, the decrease in the expense ratio during the period, and the decrease in asset impairment losses, the company’s profit elasticity will be further released.

We estimate that the net profit of the company’s sales in 1Q19 is expected to reach more than 15%, which will increase by about 3 ppt per year.

  The construction machinery industry is expected to maintain steady growth.

Social integration 2 was added in March 2019.

86 trillion yuan, the social finance growth rate was 10.

7%, an increase of 0 from the previous month.


We expect that with the easing of financial conditions, infrastructure investment growth will pick up, and downstream demand for construction machinery will continue to grow steadily; in 2019, the sales growth rate 南京夜网论坛 of the excavator, crane, and concrete machinery industries is expected to reach 10% / 30% / 20-30%, respectively.Right and left, the company is expected to maintain a higher growth rate.

  Estimates and suggestions to consider the company’s profitability improvement, raise the company’s 2019 / 20e profit forecast8.

0% / 7.

1% to 99.


7.2 billion.

The company currently expects a P / E of 10 for 2019 / 20e.

9x / 9.

4 times.

Maintain the recommendation level, and raise the target price by 8% to 16 due to the upward revision of profit forecast.

20 yuan, corresponding to 14/12 times P / E in 2019/20, corresponding to 25% upside currently expected.  The growth rate of risk infrastructure investment has been broken down, and market competition has intensified.