Sany Heavy Industry (600031) Quarterly Report Review: Performance Meets Expectations Continuous Improvement in Operating Quality

Sany Heavy Industry (600031) Quarterly Report Review: Performance Meets Expectations Continuous Improvement in Operating Quality

The performance was in line with expectations, and the quality of operations continued to improve. The company released the third quarter report for 2019. From January to September, it achieved operating income of 58.7 billion / + 43%, which was attributed to net profit of 91.

6 ppm / + 88%, after deducting 92.

5 ppm / + 77%, performance is in line with expectations.

Q3 revenue increased by 18%, and excavators and concrete machinery achieved rapid growth.

The company’s competitiveness has continued to improve, the profitability has further room for improvement, and the quality of operations has improved.

Expected EPS for 2019-21 is 1.



78 yuan, PE is 10.



8 times.

To benchmark global leaders, we are optimistic about the company’s long-term development potential.

Give 20x PE evaluation 10x?
11x, corresponding to a target price of 15.



99 yuan, maintain “Buy” rating.

In Q3, revenue increased by 18%, and the sales volume of the construction machinery industry, which realized rapid growth of excavators and concrete machinery, increased rapidly, and the company’s competitiveness continued to increase, thereby increasing the product city share.

Q3 single-quarter revenue was US $ 15.3 billion / + 18%, which was narrower than the increase in Q2 revenue growth in the previous quarter. We judge that the three major breakthrough products performed differently: 1) Excavators maintained growth rates higher than the industry level, 1-9The monthly sales volume of the excavator industry increased by 15%, of which Q3 single-quarter sales increased by 16% quarterly; 2) Concrete machinery ranked first in the world, benefiting from real estate investment exceeding expectations, rapid project construction, and rapid growth of concrete machinery; 3) The Q3 crane industry’s single quarter sales volume has dropped by 4% each year, and the company’s market share is high, or it will be affected to some extent.

The profitability was quickly repaired, the cost was well controlled, and the R & D investment increased by 32% from January to September.

5% / + 1.

4 pct, Q3 single quarter gross margin was 33.

0% / + 2.

9 pct, we judge that the gross profit margin of the excavator is relatively stable, the hoisting machinery has improved slightly, and the concrete machinery has room to improve.

The net interest rate from January to September was 16.

0% / + 3.

7 pct, Q3 single quarter net profit was 16.

1% / + 4.

2 pct, benefited from: 1) the company vigorously promoted digitalization and intelligent manufacturing, operating quality, operating efficiency, and per capita output value continued to increase; 2) costs were effectively controlled, and costs were reduced by 9 during the period from January to September

1%, sales / management / financial expense ratios are reduced by 1 each year.



5 pct.

The company continued to increase R & D investment in construction machinery and key components, and the Q3 R & D expense ratio reached 5 in a single quarter.

5% / + 2.

5 pct.
The operating quality continued to improve, the financial structure was stable, the operating cash flow was stable, and the operating efficiency was improved. The changes in the accounts receivable and inventory turnover ratio from January to September significantly increased.
The overdue amount dropped significantly, and the overdue rate of new sales was well controlled.

The financial structure is 西安耍耍网 stable, with assets and liabilities replenishing 50 at the end of September.
76%, compared with the previous quarter and supplement 4 respectively.

3 pct with 2.

6 pct.

Net cash flow from operating activities from January to September94.

45 ppm / + 8%, the highest level in history.

We raise our profit forecast and maintain a “Buy” rating. We expect the construction machinery industry to develop steadily in 20 years, the company’s competitiveness will continue to increase, and its profitability will be higher than expected.

It is estimated that the net profit attributable to mothers will be 110/130/150 trillion and the EPS will be 1 in 2019-21.



78 yuan (up 6).

5% / 3.

4% / 2.

3%), PE is 10.



8 times.

Domestic companies in the same industry have an average PE value of 9 in 20 years.

1x, overseas leader CAT and Komatsu’s 20-year PE average 11.


To benchmark global leaders, we are optimistic about the company’s long-term development potential.
Give the company an estimated 10x PE in 2020?
11x, corresponding to a target price of 15.


99 yuan, maintain “Buy” rating.

Risk reminders: The domestic economy is down faster than expected; the growth rate of infrastructure investment has not risen as expected; real estate investment has continued to narrow; the industry’s competitive environment has deteriorated; new product markets have not expanded smoothly;