External broker reports(aggregated public sources), CMB International

CMB International

External broker reports(aggregated public sources)

Incorporated in Hong Kong, supported by the mainland and targeting in global market, CMB International Capital Corporation Limited (“CMBI”) is an integrated financial institution providing comprehensive and professional services. As a wholly-owned subsidiary of China Merchants Bank ("CMB"), by leveraging on the Group’s synergy and coordination in domestic and overseas markets, as well as CMB’s strong resources and outstanding social reputation, CMBI and its subsidiaries have been actively implementing diversified business strategies and set up an overall layout of main business segments including Corporate Finance, Asset Management, Wealth Management, Global Markets and Structured Finance, etc. Adhering to the philosophy of “being clients oriented and increasing our own values by the way of creating value for clients”, CMBI endeavors to provide quality and integrated financial services to institutional, corporate and individual customers both domestic and overseas including Hong Kong IPO sponsorship and underwriting, share placement and rights issue for listed companies, financial advisors, bonds issuance services, asset management, direct investment, wealth management, equity sales and trading, etc.

Thematic (Sector/Industry)

<ul><li>China Construction Machinery Association (CCMA) released a full set of construction machinery sales data for Feb.</li><li>Unlike the stronger-than-expected earth-moving machinery (excavator and wheel loader) data that released last week (CMBI report: link), the picture for other machinery was unclear.</li><li>Forklifts and truck cranes saw growth in both domestic and overseas markets, while tower cranes (highly related to property) / aerial work platforms (AWPs) saw 33%/24% decline in China market despite a low base. </li></ul>Content is external broker report sourced from online content aggregator through publicly available sources and is displayed below for general informational purposes only. Refer full disclaimer below.

China Construction Machinery Association (CCMA) released a full set of construction machinery sales data for Feb.Unlike the stronger-than-expected earth-moving machinery (excavator and wheel loader) data that released last week (CMBI report: link), the picture for other machinery was unclear.Forklifts and truck cranes saw growth in both domestic and overseas markets, while tower cranes (highly related to property) / aerial work platforms (AWPs) saw 33%/24% decline in China market despite a low base. Content is external broker report sourced from online content aggregator through publicly available sources and is displayed below for general informational purposes only. Refer full disclaimer below.

Capital Goods - Non-earth-moving machinery sales data mixed in Feb

<ul><li>China Construction Machinery Association (CCMA) released the earth-moving machinery sales data for Jan 2025.</li><li>Despite an early CNY this year, sales of excavators / wheel loaders still edged up 1%/2% YoY, which suggest resilient demand.</li><li>We expect a decent export growth and the upcycle of domestic replacement demand will continue for earth-moving machinery this year. In addition, given the traditional peak season in Mar, we see chances for construction machinery names to gain traction over the coming two months. </li></ul>Content is external broker report sourced from online content aggregator through publicly available sources and is displayed below for general informational purposes only. Refer full disclaimer below.

China Construction Machinery Association (CCMA) released the earth-moving machinery sales data for Jan 2025.Despite an early CNY this year, sales of excavators / wheel loaders still edged up 1%/2% YoY, which suggest resilient demand.We expect a decent export growth and the upcycle of domestic replacement demand will continue for earth-moving machinery this year. In addition, given the traditional peak season in Mar, we see chances for construction machinery names to gain traction over the coming two months. Content is external broker report sourced from online content aggregator through publicly available sources and is displayed below for general informational purposes only. Refer full disclaimer below.

Capital Goods - A Good Start for Earth-Moving Machinery Sales in Jan

<ul><li>China Construction Machinery Association (CCMA) released a full set of construction machinery sales data for Dec 2024.</li><li>Export volume growth remained strong across all types of machines, in particular truck cranes and tower cranes that surged 67% YoY and 95% YoY respectively.</li><li>In China, overall demand saw little improvement, with excavator being the only product that saw growth in Dec. </li></ul>Content is external broker report sourced from online content aggregator through publicly available sources and is displayed below for general informational purposes only. Refer full disclaimer below.

China Construction Machinery Association (CCMA) released a full set of construction machinery sales data for Dec 2024.Export volume growth remained strong across all types of machines, in particular truck cranes and tower cranes that surged 67% YoY and 95% YoY respectively.In China, overall demand saw little improvement, with excavator being the only product that saw growth in Dec. Content is external broker report sourced from online content aggregator through publicly available sources and is displayed below for general informational purposes only. Refer full disclaimer below.

Capital Goods - Export Volume Growth Across All Machines in Dec

Equity Bottom-Up

Jiangsu Hengli Highpressure Oil Cylinder / Equity Bottom-Up

<ul><li>Hengli’s EBIT in 3Q24 dropped 6% YoY to RMB445mn, due to gross margin contraction of 1.9ppt YoY despite an 11% YoY increase in revenue.</li><li>The margin contraction, which was due to lower utilisation rate based on our understanding, is slightly below our expectation.</li><li>Reported net profit grew 6% YoY to RMB504mn, helped by increases in net finance income and other gains. </li></ul>Content is external broker report sourced from online content aggregator through publicly available sources and is displayed below for general informational purposes only. Refer full disclaimer below.

Hengli’s EBIT in 3Q24 dropped 6% YoY to RMB445mn, due to gross margin contraction of 1.9ppt YoY despite an 11% YoY increase in revenue.The margin contraction, which was due to lower utilisation rate based on our understanding, is slightly below our expectation.Reported net profit grew 6% YoY to RMB504mn, helped by increases in net finance income and other gains. Content is external broker report sourced from online content aggregator through publicly available sources and is displayed below for general informational purposes only. Refer full disclaimer below.

Jiangsu Hengli (601100 CH) - 3Q24 Earnings Below Expectations Due to Margin Contraction

<ul><li>The two major earthmoving machinery, excavators and wheel loaders, saw double-digit sales volume growth in Aug, according to China Construction Machinery Association (CCMA).</li><li>Most notable is that exports of excavators grew 7% YoY to ~8k units in Aug, the first YoY growth since May 2023, an early sign of recovery.</li><li>Exports of wheel loaders remained strong with 22% growth in Aug. In China market, sales of excavators grew 18% YoY to 6.7k units in Aug, but the growth rate slowed gradually from 26%/22% in Jun/Jul. </li></ul>Content is external broker report sourced from online content aggregator through publicly available sources and is displayed below for general informational purposes only. Refer full disclaimer below.

The two major earthmoving machinery, excavators and wheel loaders, saw double-digit sales volume growth in Aug, according to China Construction Machinery Association (CCMA).Most notable is that exports of excavators grew 7% YoY to ~8k units in Aug, the first YoY growth since May 2023, an early sign of recovery.Exports of wheel loaders remained strong with 22% growth in Aug. In China market, sales of excavators grew 18% YoY to 6.7k units in Aug, but the growth rate slowed gradually from 26%/22% in Jun/Jul. Content is external broker report sourced from online content aggregator through publicly available sources and is displayed below for general informational purposes only. Refer full disclaimer below.

Capital Goods - Excavator Exports Grew for the First Time in 15 Months

China

Jiangsu Hengli Hydraulic Co Ltd develops, manufactures and sells high pressure tank, hydraulic components and hydraulic systems. The Company's main products include fuel tanks and non-standard cylinders for heavy equipment.

Jiangsu Hengli Highpressure Oil Cylinder (601100 CH)

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Jiangsu Hengli Highpressure Oil Cylinder (601100 CH)

Capital Goods - Non-earth-moving machinery sales data mixed in Feb

We continue to favour earth-moving machinery which is the first to recover in both the project-level cycle and replacement cycle.

CMB International

Capital Goods - A Good Start for Earth-Moving Machinery Sales in Jan

We remain positive on Zoomlion (1157 HK / 000157 CH, BUY), SANY Heavy (600031 CH, BUY) and Jiangsu Hengli (601100 CH, BUY).

CMB International

Capital Goods - Export Volume Growth Across All Machines in Dec

Export volume growth remained strong across all types of machines, in particular truck cranes and tower cranes that surged 67% YoY and 95% YoY...

CMB International

Jiangsu Hengli (601100 CH) - 3Q24 Earnings Below Expectations Due to Margin Contraction

Hengli’s EBIT in 3Q24 dropped 6% YoY to RMB445mn, due to gross margin contraction of 1.9ppt YoY despite an 11% YoY increase in revenue.

CMB International

Capital Goods - Excavator Exports Grew for the First Time in 15 Months

The two major earthmoving machinery, excavators and wheel loaders, saw double-digit sales volume growth in Aug, according to China Construction...

CMB International

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