Construction machinery industry: consolidation after high growth

Rapid and sustained growth of investment drives the rapid development of the construction machinery industry From 2000 to 2010, China's fixed asset investment grew at an average annual rate of 23.6%, and industry sales revenue increased from 48 billion yuan to 446.7 billion yuan in 2010, an increase from 2000. 8 times, the compound growth rate is 24.7%. Future industry planning By 2015, sales revenue is expected to reach 900 billion yuan, and the compound growth rate will be 17% in five years. The growth of the industry will slow down for a long time.

The industry's booming degree has gradually declined, and the growth rate of sales revenue has gradually slowed. Along with the continuous decline in the sales growth of the industry, the growth rate of the industry's revenue and total profit has slowed down from month to month. From January to September 2011, the above-scale enterprises realized their main income 3 927 billion yuan, an increase of 36.8%; total profit of 38.5 billion yuan, an increase of 26.1%. From the perspective of growth rate, the monthly growth rate has dropped by about 3 percentage points since February 2011, and the rate of decline in industry profit growth appears to be even faster.

The year-on-year growth rate of finished products was as high as 63.2%, and the industry inventory pressure began to ease, but the pressure was still high.

2012 Industry Outlook:

Real estate purchase restrictions and railway construction have returned to normal, and investment in fixed assets has continued to fall.

Under the influence of the continued implementation of real estate purchase restriction and the gradual return of railway project planning, the growth rate of real estate and infrastructure investment will decline. The real estate investment growth rate is expected to fall to 10-15%; According to the current railway development plan, railway investment in 2012 A year-on-year drop of around 20%, the added mileage for the next five years of highway planning is equivalent to that during the “Eleventh Five-Year Plan” period. The investment highlights of rail transit and water conservancy planning are presented, but the proportion of investment in fixed assets accounts for a relatively small proportion. In summary, we expect that the 2012 fixed The growth rate of asset investment is about 18-20%.

The industry's production capacity has expanded dramatically and the future competition has intensified. In 2010, industry sales continued to be hot. Major companies have increased investment and expanded production capacity. Capital expenditures of major companies in the third quarter have increased by 50.6% year-on-year. Take the excavator as an example. In recent years, domestic and foreign construction machinery companies have expanded their production capacity. China estimates that the excavator production capacity will reach 385,300 units in 2012, and the annual domestic excavator production capacity will reach 500,000 units by 2015.

From the demand side, the future industry comes from the rapid expansion of the market is bound to weaken the momentum, the growth rate will gradually return to normal and stable growth. The peak period of the industry is expected to occur around 2020, with an annual demand of around 30,000-30,000 units. Therefore, it is expected that competition in the industry will be extremely fierce in the future.

Unbalanced production and demand, reduced capacity utilization, leading to a slow decline in the industry ROE In recent years, the expansion of major products, diversified development strategy led to the trend of horizontal whole-product chain competition in the industry, the industry will continue to destock inventory circulation process until next year In the quarter, under the imbalance of supply and demand, the industry's capacity utilization rate has dropped, and the industry's ROE will gradually decline at a high level.

As the industry enters the adjustment period and the competition intensifies, the leading enterprises will eventually win. In the future, the industry will face increased competition and downstream demand will slow down. The future competition will focus on product quality, brand, sales channels, after-sales service and comprehensive ability of supporting capabilities. on. Leading companies have strong financial advantages, strong technological research and development capabilities, product diversification, and a global strategic layout. In the midst of fierce competition, the “strong and strong” will eventually emerge.

The industry lacks trending investment opportunities and expects to overshoot and rebound. The short-term prosperity of construction machinery continues to fall, and the imbalance between production and demand reduces the profitability of the industry. It is expected that the industry will lack continuous investment opportunities in 2012.

At the same time, construction machinery is a short-cycle industry, most closely related to the country’s macro-control policies, and the most responsive to policy changes. Next year, the macro economy will face the choice of “guaranteing growth OR controlling inflation” and expects that the policy may shift to the oversold rebound opportunity.