SANY HEAVY INDUSTRY CO.,LTD is a China-based company principally engaged in the research and development, manufacture, distribution and provision of services of engineering machinery. The Company's major products are categorized into five types, which are concrete machinery, excavating machinery, hoisting machinery, pile driving machinery and road construction machinery, including truck-mounted concrete pumps, trailer concrete pumps, excavators, truck cranes, rotary drilling rigs and sets of road equipment, among others. The Company distributes its products in both domestic and to overseas markets.
Zoomlion Heavy Industry Science And Technology Co., Ltd. is principally engaged in the research, development, manufacture and sales of engineering equipment, environmental sanitation equipment and agricultural equipment. The Company operates through four segments. The Engineering Equipment segment includes concrete equipment, lifting equipment, earthmoving equipment, foundation construction equipment, road construction equipment and forklifts, which mainly serve the construction of infrastructure and real estate. The Environmental Industry segment is engaged in the production of sanitation equipment, as well as environmental management investment and operating business. The Agricultural Equipment segment consists of farming machinery, harvesting machinery, drying machinery and agricultural machinery, among others. The Financial segment provides financial leasing and other financial services.
The company has kept its full-year target (no less than 20% yoy revenue growth) intact, backed by ample order backlog on hand and stronger-than-expected exports. Besides, we believe the continuous ramp-up in new product launches would serve as one the key growth drivers for the company going forward. Maintain BUY and target price of HK$5.50.
The upcoming 14th 5-year plan will focus on transforming China into an advanced economy by 2035; its success will also be a reflection of Presidents Xi’s ability to deliver on his vision for China. Nevertheless, it will be no easy feat with the risks of further sanctions from the US and uncertain pace of global economic recovery. For 4Q20, we expect new infrastructure names and beneficiaries of the domestic travel recovery to outperform. Our top picks include CEA, Estun and Tongcheng-EL.
GREATER CHINA Strategy The Next 5 Years - From Innovation To Impact: We are adding beneficiaries of the upcoming 14th 5-year plan, namely new infrastructure stocks, and those of domestic travel recovery. Our top picks: CEA, Estun and Tongcheng-EL. Sector Automobile: Weekly: PV retail sales grow 39% yoy in the second week of September, beating estimate. Maintain MARKET WEIGHT. Top picks: Weichai, Brilliance and CATL. Update Sany Heavy Equipment International Holdings (631 HK/BUY/HK$4.60/Target: HK$5.50): Better operating efficiency in sight. Tongcheng-eLong (780 HK/BUY/HK$14.66/Target: HK$18.00...
After the post-results selldown on the back of lacklustre results and guidance, we see two major obstacles in the way of a rebound in sentiment for the handset component names under our coverage, namely de-spec and sanctions on Huawei. While we believe that both obstacles have already been largely reflected in the current share prices, the ongoing unstable geopolitical environment will likely remain an overhang. Downgrade sector rating to MARKET WEIGHT. Top pick: Sunny Optical.
For 2021, we expect Indocement sales volume to grow 7.6% yoy to 17.5m tons on the back of a recovery in the bag and bulk segments. The latter would be driven by a 47.3% jump in the infrastructure budget to Rp414t for 2021. Higher sales volume and a 2% rise in ASP should lead to a higher operating leverage and 43.5% 2021F EPS growth. Coupled with a 13.1% share price decline, maintain BUY with a lower target price of Rp16,200, based on 19.1x 2021F EV/EBITDA.
Indocement Tunggal Prakarsa (INTP IJ/BUY/Rp10,775/Target: Rp16,200): Buying opportunity on 13.1% price decline and 43.5% 2021F EPS growth. TRADERS’ CORNER Siloam International Hospital (SILO IJ): Technical BUY Astra Agro Lestari (AALI IJ): Technical BUY
REGIONAL Sector Banks: ASEAN banks monthly. GREATER CHINA Strategy Alpha Picks: Greater China September Conviction List: With the 12-month forward PE of MSCI China trading at a new high of 15.2x, the divergence of current market performance from fundamentals is too large to ignore. INDONESIA Update Mitra Adiperkasa (MAPI IJ/BUY/Rp690/Target: Rp920): Weekly improvement in traffic and sales. With >30% upside, maintain BUY. MALAYSIA Sector Rubber Gloves: 2Q20 results well surprised on the upside, led by Supermax and Top Glove. However, this is only a prelude to full potential of windfall earni...
After a strong rally for three consecutive months, the MSCI China index has come near an all-time high of 102.5pt, with the 12-month forward PE of MSCI China trading at a new high of 15.2x. We re-iterate our strategy to avoid beta chasing. Focus on beneficiaries of policy support and domestic demand recovery. New inclusions are Feihe, Han's Laser, Kingsoft Corp, Link REIT, Times Neighborhood, and WuXi AppTec.
KEY HIGHLIGHTS Strategy Alpha Picks: Greater China September Conviction List: With the 12-month forward PE of MSCI China trading at a new high of 15.2x, the divergence of current market performance from fundamentals is too large to ignore. TRADERSâ€™ CORNER COSCO Ship Port (1199 HK): Trading Buy Range: HK$4.62-4.63 Longfor Group (960 HK): Trading Buy Range: HK$43.45-43.50
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