reports
- John Hu
The worst days are over, with better top-line growth and stronger free...
No-moat Zoomlion’s 2017 net income of CNY 1.3 billion was in line with its preliminary result release, while the 16% year-on-year top-line growth to CNY 23.2 billion was as expected. The earnings rebound was driven by the strong underlying demand for its concrete machinery and crane segment. For 2018, we anticipate a more moderate net earnings and top-line growth of 12% and 10%, respectively, as the central government’s more prudent fiscal policy will likely constrain industry growth potenti...
- John Hu
Zoomlion's FY17 Net Profit Reached CNY 1.3 Billion on Improving Core B...
No-moat Zoomlion’s 2017 net income of CNY 1.3 billion was in line with its preliminary result release, while the 16% year-on-year top-line growth to CNY 23.2 billion was as expected. The earnings rebound was driven by the strong underlying demand for its concrete machinery and crane segment. For 2018, we anticipate a more moderate net earnings and top-line growth of 12% and 10%, respectively, as the central government’s more prudent fiscal policy will likely constrain industry growth potenti...
- John Hu
China's Debt: The Consequences of Bingeing on Debt
The rapid expansion in China's debt/GDP ratio has raised concerns among many observers, including us, because it is reminiscent of prior credit booms that have ended badly. Having watched Beijing repeatedly stimulate its way to higher growth, investors ask why this can't continue. Bluntly, if credit continues to outpace GDP growth significantly, we expect one of two scenarios to eventually occur. The first scenario is a full-blown credit crisis. Here, we'd see credit availability sharply contra...
- John Hu
Zoomlion Returned to Profitability in 2017 Amid Strong Demand Recovery...
The no-moat Zoomlion expects 2017 net income to be in the range of CNY 1.3-1.4 billion, according to its preliminary result announcement. While the company’s estimate missed our forecast by roughly 15%, the underlying demand for company’s core product lines remains strong, and we expect the company’s earnings growth to be sustained into 2018 on the back of ongoing domestic economic recovery. After adjusting for an appreciating Chinese yuan and the company’s lower credit risk profile, we ...
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