Construction Machinery: Three Factors Drive the Continued Economy of the Concrete Machinery Market

In the past two years, the performance of concrete machinery sub-sectors has outperformed other sub-sectors of construction machinery. This year it is even more outshone. The main reasons are: (1) Demand is sinking to third and fourth-tier cities to promote market space growth; (2) Product upgrading, Promote market growth; (3) More flexible sales methods.

The prospects for the concrete machinery market in June and 3rd: June will certainly not be too bad, but under the seasonal influence, it will be slightly lower than in May, but the decline should be smaller than in previous years. In the third quarter, it is expected that the off-season will not be very light, and major projects approved in the near future will have a pulling effect, and it is expected that the growth rate will exceed 30%.

The influence of real estate regulation on the concrete machinery industry is controllable: the first-tier cities are the ones most affected by real estate regulation. However, as demand sinks, the proportion of sales of concrete machinery in first-tier cities has plummeted, and that of third- and fourth-tier cities soars. On the one hand, the third- and fourth-tier cities are not affected by the regulation of real estate. On the other hand, the stock of concrete machinery in the third and fourth-tier cities is very low.

The increase in the proportion of jib boom trucks was driven by three factors: (1) The increase in manpower cost, the shortage of migrant workers at the construction site, and the relatively small number of auxiliary vehicles required for long vehicles; (2) Longer vehicles are more efficient and longer than short vehicles. (3) The competition between customers to promote long-term car demand.

The market for dry mortar equipment is worthy of attention: It has broad prospects and is very similar to the commercial mixed market. (1) The product composition is similar. There are stations, production equipment, logistics equipment, and pumping equipment; (2) Development history Similarly, in the 1990s, China began to advocate the development of business mix, and it was initially driven by government policies. Today's dry mix is ​​equivalent to the mix of the 1990s. Now the government has started to promote dry-mixed mortar, which prohibits on-site mixing in major cities; (3) Dry mixing The market capacity is equivalent to 1/3-1/4 of the capacity of the concrete market, the market capacity of China's concrete machinery is 120 billion, and the dry blend market capacity is about 30-40 billion.

Guotai Junan Construction Machinery Sub-industry's point of view: The industry's weak fundamentals have gradually eased, and the sales volume of real estate sales and large-scale infrastructure projects have steadily improved. Based on these leading indicators, industry fundamentals are expected to bottom out in June, maintaining the rating of construction machinery holdings. The focus is on Zoomlion, Sany Heavy Industry, Xugong Machinery, Liugong, and Anhui Heli.

The overall view of Guotai Junan Machinery Industry: market interest rates remain low, and the sharp increase in credit in May reaffirms that monetary policy continues to be practically loose, while the recovery of M1 and M2 also reflects the gradual increase in policy relaxation; infrastructure investment will pick up, 3 Since the beginning of the month, the examination and approval of infrastructure projects has been speeding up, the engineering design volume has increased, and real estate sales have maintained a relatively high growth rate; maintaining the fundamentals of the industry will start to bottom out in June, with emphasis on recommending construction machinery and railway equipment. Continue to recommend energy machinery and cold chain equipment, focusing on event-driven opportunities for ships and nuclear power equipment.