20250702-招银国际-Capital_Goods_HDT_sales_+29_YoY_in_Jun,_better_than_expectation_5页_803kb

Summary

1. Key Highlights

• Strong HDT Sales Growth: China's Heavy Duty Truck (HDT) sales volume increased by 29% YoY in June 2025 (92,000 units), exceeding expectations. This growth was primarily driven by the implementation of the truck replacement subsidy policy introduced in March, which incentivizes the purchase of New Energy (NES) IV and natural gas trucks.
• Policy Impact: The recovery in HDT sales (three consecutive months of growth: +7% in April, +14% in May, +29% in June) is attributed to government policies, particularly the favorable replacement subsidy program. The policy covers up to 30% of total trucks based on fleet size estimates.

2. Year-End Projections

• CMBIGM maintains its full-year HDT sales growth estimate at 10% for 2025. Companies expected to benefit include Weichai Power (BUY) and Sinotruk (HOLD).

3. Analysis on Specific Companies

• Weichai Power (2338 HK/000338 CH):
  • The company stands to benefit from the positive sector trends in the second half of 2025, driven by strong engine margin expansion and a record-high dividend payout ratio.
• Sinotruk (3808 HK):
  • Despite positive domestic trends, there are cautionary notes on export opportunities.
• Zoomlion (1157 HK/000157 CH):
  • Although 2024 results missed expectations, the company's overseas growth momentum remains a key positive factor.

4. Market Trends

• Earthmoving Machinery: Sales growth in the earthmoving sector (especially domestic) has shown resilience, with strong demand linked to replacement cycles.
• Electric/Natural Gas Trucks: Electric HDTs now account for roughly 2% of total sales, while natural gas trucks have seen increasing market share. Economic analysis shows that LNG (Natural Gas) trucks can have shorter payback periods under current gas price conditions.

5. Investment Recommendations

• The CMBIGM ratings for key companies are as follows:
  • SANYI (631 HK): BUY (Position: Early stage of earnings recovery with attractive valuation).
  • Weichai Power (2338 HK/000338 CH): BUY.
  • Sinotruk (3808 HK): HOLD.
  • Zoomlion (1157 HK/000157 CH): BUY.

Analyses by Topic

• Previous Reports: The analysis draws from a series of recent reports (e.g., on SANY Heavy's 1Q25 earnings, Zoomlion’s 2024 results, Sinotruk’s cautious export outlook) that collectively signal a mixed but broadly positive market outlook.

About the Report

This Equity Research Sector Update from CMB International Global Markets focuses on capital goods, analyzing trends, investments, and policy impacts. This summary distills the core points from the extended analysis presented in the original document.