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According to the industry statistics of China Construction Machinery Industry Association, the 25 main engine manufacturing enterprises included in the statistics in November 2021 sold 20444 sets of excavators. Among them, 14014 sets are sold in the Chinese market and 6430 sets are exported.
Key investment points
In November, the sales volume of excavators was 20000 units, a year-on-year decrease of 37%, which was larger than that in October; 8% increase from January to November
In November, the sales volume of excavators was 20000 units, a year-on-year decrease of 37%, including 14000 units in China, a year-on-year decrease of 51%; 6430 sets were exported, a year-on-year increase of 89%. CME previously predicted that in November, the sales volume of excavators fell 38% year-on-year, of which China fell 53% year-on-year and the export sales growth rate was 91%. If compared with 2019, the sales volume in November 2021 is 6% higher than that in November 2019, and the two-year compound growth is 3%. From January to November, the year-on-year growth rate of excavator sales was 97%, 205%, 60%, 3%, – 14%, – 6%, – 9%, – 14%, – 23%, – 31% and – 37% respectively. The monthly decline in November was 37%, which was larger than that in October.
In November, the proportion of small excavation sales increased by 3.0pct, the proportion of medium excavation sales decreased by 4.0pct, and the proportion of large excavation sales increased by 1.0pct
In November, the sales volume of small excavation in the Chinese market was 8806 units, a year-on-year decrease of 49%, accounting for 63%, a year-on-year increase of 3.0 PCT; The sales volume of China mining was 3327 units, a year-on-year decrease of 58%, accounting for 24%, a year-on-year decrease of 4.0 PCT; The sales volume of large-scale excavation was 1881 units, with a year-on-year decrease of 48%, accounting for 13%, with a year-on-year increase of 1.0pct. From January to November, the sales volume of small excavation in the Chinese market was 153000 units, with a year-on-year increase of – 5%, accounting for 59%, with a year-on-year decrease of 1PCT; The sales volume of medium excavation was 74000 units, with a year-on-year increase of 6%, accounting for 29%, with a year-on-year increase of 2pct; The sales volume of large-scale excavation was 31000 units, with a year-on-year increase of – 10%, accounting for 12%, with a year-on-year decrease of 1 PCT.
The central bank comprehensively lowered the reserve requirement by 0.5%, strengthened the expectation of steady growth, and improved the expected margin of downstream demand for construction machinery
The RRR reduction on December 6 is the implementation of the “timely RRR reduction” proposed by Premier Li Keqiang on December 3, so as to reduce the financing cost of enterprises, alleviate the operating pressure of enterprises and stabilize economic growth. According to the prediction of Zheshang macro team, there will be “four arrows” of wide credit in the first quarter of 2022: manufacturing loans, carbon reduction loans, infrastructure loans and mortgage loans. Construction machinery downstream infrastructure, real estate and rural construction demand is expected to usher in marginal improvement.
The export of excavator reached a new high in November. If the export increases by 50% next year, it can hedge China’s 10% – 22% decline
In November, 6430 sets were exported, with a year-on-year increase of 89%. The export sales volume of excavators has reached 52% CAGR in the past five years. It is expected to achieve the export volume of more than 60000 units in 2021, with a year-on-year increase of at least 73%, showing an accelerating trend. If a relatively pessimistic assumption is adopted for the growth rate of excavator sales in 2022 (assuming a growth rate of – 10% ~ 0% in 2022), if the export of excavator can maintain a growth of 50%, the decline of 10% – 22% of China’s excavator sales can be hedged.
Sany Heavy Industry Co.Ltd(600031) and other companies are expected to move from Chinese leader to global leader by virtue of internationalization, digitization and electrification
Construction machinery is China’s current advantageous industry. Chinese companies can rely on economies of scale, industrial chain and operation efficiency to achieve a global leading position. After completing China’s import substitution, industry leaders such as Sany Heavy Industry Co.Ltd(600031) will gain a considerable market share in the world by virtue of internationalization, digitization and electrification, and move from Chinese leader to global leader.
Investment advice
Construction machinery continues to focus on the leader of strong alpha attribute. Recommended Sany Heavy Industry Co.Ltd(600031) , Jiangsu Hengli Hydraulic Co.Ltd(601100) , Xcmg Construction Machinery Co.Ltd(000425) , Zhejiang Dingli Machinery Co.Ltd(603338) ; Continue to be optimistic about Zoomlion Heavy Industry Science And Technology Co.Ltd(000157) , Shaanxi Construction Machinery Co.Ltd(600984) , Hangcha Group Co.Ltd(603298) , Anhui Heli Co.Ltd(600761) .
Risk statement
Infrastructure and real estate investment are less than expected; The export growth rate of excavator was lower than expected.
