\u3000\u3 Jointo Energy Investment Co.Ltd.Hebei(000600) 031 Sany Heavy Industry Co.Ltd(600031) )
Event: Sany Heavy Industry Co.Ltd(600031) released the 2021 annual report, and the company’s annual operating revenue was 106113 billion yuan, a year-on-year increase of + 6.82%; The net profit attributable to the parent company was 12.033 billion yuan, a year-on-year increase of – 22.04%; The net cash flow from operating activities was 11.904 billion yuan, a year-on-year increase of – 11.29%, and the operation remained stable throughout the year.
The overall revenue of core products increased steadily, and the gross profit margin decreased year-on-year. The core business of the company maintains strong competitiveness. Concrete equipment is the first brand in the world. Leading products such as excavators, large tonnage cranes, rotary drilling rigs and complete sets of pavement equipment have become the first brand in China. In 2021, the revenue of excavator / concrete machine / crane reached 41.752667421859 billion yuan respectively, with a year-on-year increase of + 11.25% / – 1.40% / + 12.62%, and the gross profit margin was 28.94% / 24.99% / 19.59% respectively, with a year-on-year increase of -5.73pct / – 2.31pct / – 2.08pct, mainly due to the increase of raw material price and freight.
The strong are always strong, and the electrification, intellectualization and internationalization are progressing smoothly. As a leader in the construction machinery industry, Sany Heavy Industry Co.Ltd(600031) market share is stable and continues to increase, and the overall industry shows a trend of constant strength. In 2021, the company completed the development of 34 electric products and 20 listed electric products. The sales volume of electric engineering vehicles exceeded 1000 units, with a sales volume of nearly 1 billion yuan. The market share ranked first in the industry, among which electric mixer truck, electric dump truck and electric crane won the top in annual sales volume; The company vigorously promotes the construction of “lighthouse factory”. In 2021, we will promote the construction of 22 lighthouse factories, and a total of 14 have been completed to reach production capacity. The production capacity will be increased by 70%, the manufacturing cycle will be shortened by 50%, and the overall automation rate of the process will be greatly improved; Positive progress has been made in internationalization. In 2021, the company achieved international sales revenue of 24.846 billion yuan, a year-on-year increase of + 76.16%, and the proportion of international revenue in operating revenue was + 9.2pct year-on-year.
The steady growth policy is expected to increase, and the demand side is expected to improve gradually. According to China Construction Machinery Industry Association, Q1 enterprises sold 77175 excavators in 2022, a year-on-year increase of – 39.2%; Among them, 51886 units in China, a year-on-year increase of – 54.3%; 25289 sets were exported, a year-on-year increase of + 88.6%. According to CME data, the expected sales volume of excavators (including exports) in April 2022 is about 26500 units, with a year-on-year decrease of about – 43%, which is slightly improved compared with the previous month. Due to the impact of the epidemic and other factors, it is more difficult to achieve the annual economic growth target of 5.5%. The growth policy is expected to be further overweight and strengthen countercyclical regulation to ensure that the economy operates within a reasonable range in the second quarter. At the same time, local real estate policies have been relaxed. Reducing down payment, interest rate and optimizing the identification standard of second set of housing will effectively stimulate the release of housing demand; Infrastructure investment is at full capacity. Among the new 3.65 trillion yuan of special debt limit this year, special debt related to infrastructure construction accounts for more than 60%, and the demand for infrastructure investment is expected to exceed expectations in the second quarter. We believe that although the inflection point of the downward trend of the current industry data has not yet appeared, with the sustained force of steady growth, the demand side is expected to gradually improve.
Investment suggestions:
Sany Heavy Industry Co.Ltd(600031) operating revenue increased year-on-year, market share continued to improve, overseas business and digital transformation progressed smoothly, and the buy rating was maintained. We estimate that the operating revenue of the company from 2022 to 2024 will be 111287 billion yuan, 117631 billion yuan and 126912 billion yuan respectively, and the net profit attributable to the parent company will be 12.430 billion yuan, 12.972 billion yuan and 13.913 billion yuan respectively, corresponding to 10 times, 10 times and 9 times of PE from 2022 to 2024.
Risk warning: the demand is less than expected; Rising commodity prices
