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.

Equity Bottom-Up

<ul><li>We visited SANYI’s headquarters and mining equipment smart factory in Shenyang, Liaoning last week.</li><li>Our discussion with the senior management and plant managers reaffirm our positive stance.</li><li>We continue to like SANYI’s strong commitment to deliver growth through strategical expansion in different segments and the continuous launch of new products. </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.

We visited SANYI’s headquarters and mining equipment smart factory in Shenyang, Liaoning last week.Our discussion with the senior management and plant managers reaffirm our positive stance.We continue to like SANYI’s strong commitment to deliver growth through strategical expansion in different segments and the continuous launch of new products. 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.

SANY International (631 HK) – Firing on All Cylinders

<ul><li>SANYI announced yesterday (12 April) after market close that it plans to acquire SANY Petroleum Intelligent Equipment (三一石油智能装备) from the controlling shareholder.</li><li>This marks the expansion into oil &amp; gas fracturing equipment segment, which we think is positive given the expected increase in oilfield spending (in particular unconventional field) amid the tight supply of oil and the consideration of energy security by different countries.</li><li>The acquisition price of RMB2.98bn (all cash) implies only 7.7x 2022 P/E, lower than the 12.8x of Yantai Jereh (002353 CH) and SANYI’s current valuation (~11x).</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.

SANYI announced yesterday (12 April) after market close that it plans to acquire SANY Petroleum Intelligent Equipment (三一石油智能装备) from the controlling shareholder.This marks the expansion into oil &amp; gas fracturing equipment segment, which we think is positive given the expected increase in oilfield spending (in particular unconventional field) amid the tight supply of oil and the consideration of energy security by different countries.The acquisition price of RMB2.98bn (all cash) implies only 7.7x 2022 P/E, lower than the 12.8x of Yantai Jereh (002353 CH) and SANYI’s current valuation (~11x).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.

SANY International (631 HK) – Acquisition of oil & gas frac equipment a positive move

<ul><li>SANYI’s core net profit in 2022 grew 53% YoY to RMB1.66bn, which is in line with our expectation.</li><li>The results imply that net profit surged 1.1x YoY to RMB369mn in 4Q22.</li><li>SANYI proposed HK$0.19 dividend per share, implying ~32% dividend pay-out. </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.

SANYI’s core net profit in 2022 grew 53% YoY to RMB1.66bn, which is in line with our expectation.The results imply that net profit surged 1.1x YoY to RMB369mn in 4Q22.SANYI proposed HK$0.19 dividend per share, implying ~32% dividend pay-out. 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.

SANY International (631 HK) – Core Net Profit in 2022 +53% YoY in Line with Expectation

Thematic (Sector/Industry)

<ul><li>Following a rally since early Feb, we believe the market has already priced in the upcoming recovery of machinery demand.</li><li>We see little upside potential in the near term, as (1) the recovery could be more seasonal (MoM) than structural (YoY), with sales of excavator (proxy for the sector) likely falling short of expectation in Mar; (2) We expect the strong credit growth will only translate into a moderate recovery of excavator demand this year (+10% YoY in our industry assumption).</li><li>Therefore, we are selective in our universe, and prefer only AWP (the only type of machinery that stands out by achieving 15% YoY growth in Jan). </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.

Following a rally since early Feb, we believe the market has already priced in the upcoming recovery of machinery demand.We see little upside potential in the near term, as (1) the recovery could be more seasonal (MoM) than structural (YoY), with sales of excavator (proxy for the sector) likely falling short of expectation in Mar; (2) We expect the strong credit growth will only translate into a moderate recovery of excavator demand this year (+10% YoY in our industry assumption).Therefore, we are selective in our universe, and prefer only AWP (the only type of machinery that stands out by achieving 15% YoY growth in Jan). 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 – Near-Term Recovery More Seasonal than Structural

<ul><li>Major aerial work platform (AWP) manufacturers (Terex, Oshkosh) and rental company (United Rentals) in the US provide bullish guidance on 2023E outlook after reporting their 2022 results.</li><li>Key takeaways: (1) AWP manufacturers saw strong order flow with backlog visibility of &gt;12 months; (2) The mega projects, which are less macro reliant, will provide both rental companies and AWP manufacturers with growth certainty over the coming years; (3) manufacturers’ margin improvement trend will continue despite the fact that supply chain will remain a constraint this year, suggesting strong pricing power.</li><li>All these reaffirm our positive stance on the AWP sector this year. </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.

Major aerial work platform (AWP) manufacturers (Terex, Oshkosh) and rental company (United Rentals) in the US provide bullish guidance on 2023E outlook after reporting their 2022 results.Key takeaways: (1) AWP manufacturers saw strong order flow with backlog visibility of &gt;12 months; (2) The mega projects, which are less macro reliant, will provide both rental companies and AWP manufacturers with growth certainty over the coming years; (3) manufacturers’ margin improvement trend will continue despite the fact that supply chain will remain a constraint this year, suggesting strong pricing power.All these reaffirm our positive stance on the AWP sector this year. 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 – Upbeat Guidance from US AWP Manufacturers

China

Sany Heavy Equipment International Holdings Co Ltd. manufactures coal mining equipment, including roadheaders.

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Sany Heavy Equipment (631 HK)

SANY International (631 HK) – Firing on All Cylinders

We continue to like SANYI’s strong commitment to deliver growth through strategical expansion in different segments and the continuous launch of...

CMB International

SANY International (631 HK) – Acquisition of oil & gas frac equipment a positive move

SANYI announced yesterday (12 April) after market close that it plans to acquire SANY Petroleum Intelligent Equipment (三一石油智能装备) from the...

CMB International

SANY International (631 HK) – Core Net Profit in 2022 +53% YoY in Line with Expectation

SANYI’s core net profit in 2022 grew 53% YoY to RMB1.66bn, which is in line with our expectation. The results imply that net profit surged 1.1x YoY...

CMB International

China Construction Machinery – Near-Term Recovery More Seasonal than Structural

Following a rally since early Feb, we believe the market has already priced in the upcoming recovery of machinery demand.

CMB International

China Construction Machinery – Upbeat Guidance from US AWP Manufacturers

Major aerial work platform (AWP) manufacturers (Terex, Oshkosh) and rental company (United Rentals) in the US provide bullish guidance on 2023E...

CMB International

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