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

Zoomlion Heavy Industry S A / Equity Bottom-Up

<ul><li>Zoomlion’s overseas sales remained strong in 2Q24 but were more than offset by the weakness in China.</li><li>We calculate that the core profit in 1H24 (after excluding gains on asset disposal) dropped 18% YoY to RMB1.65bn.</li><li>We revise down our 2024E-26E earnings forecast by 9.6-10.0%, after incorporating the weak demand for concrete machinery and cranes in China, as well as higher distribution expenses due to overseas expansion. </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.

Zoomlion’s overseas sales remained strong in 2Q24 but were more than offset by the weakness in China.We calculate that the core profit in 1H24 (after excluding gains on asset disposal) dropped 18% YoY to RMB1.65bn.We revise down our 2024E-26E earnings forecast by 9.6-10.0%, after incorporating the weak demand for concrete machinery and cranes in China, as well as higher distribution expenses due to overseas expansion. 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.

Zoomlion (000157 CH) - 1H24 Earnings Below Expectation

Zoomlion Heavy Industry H / Equity Bottom-Up

<ul><li>We are convinced by Zoomlion’s impressive global expansion strategy.</li><li>On the product side, the offering of full range of machinery through an effective direct sales model enables Zoomlion to penetrate different key markets in overseas.</li><li>On regions, the priorities on emerging economies such as the Middle East, Middle Asia and Southeast Asia over Europe and North America make it subject to less geopolitical risks. </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 are convinced by Zoomlion’s impressive global expansion strategy.On the product side, the offering of full range of machinery through an effective direct sales model enables Zoomlion to penetrate different key markets in overseas.On regions, the priorities on emerging economies such as the Middle East, Middle Asia and Southeast Asia over Europe and North America make it subject to less geopolitical risks. 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.

Zoomlion (1157 HK) - Right Strategy on Product & Global Expansion

<ul><li>Zoomlion’s net profit in 2023 grew 51% YoY to RMB3.55bn, in line with the preannounced profit range of RMB3.38-3.62bn.</li><li>Zoomlion proposed dividends of RMB0.32/shr, implying a payout ratio of 78%.</li><li>With successful global growth strategy, overseas revenue contribution in 2H23 increased to 42%, up from 35%/24% in 1H23/2022. </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.

Zoomlion’s net profit in 2023 grew 51% YoY to RMB3.55bn, in line with the preannounced profit range of RMB3.38-3.62bn.Zoomlion proposed dividends of RMB0.32/shr, implying a payout ratio of 78%.With successful global growth strategy, overseas revenue contribution in 2H23 increased to 42%, up from 35%/24% in 1H23/2022. 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.

Zoomlion (000157 CH) - 2023 Net Profit in Line; Overseas Strategy a Successful Pay-Off

HK/China Equity Long-Short

Osbert Tang, CFA

<ul>
<li>
<a href="https://www.smartkarma.com/entities/lonking-holdings-ltd" target="_blank" data-smartkarma-citation="entities:3944:1" rel="noopener">Lonking Holdings (3339 HK)</a>'s positive profit alert for 33-50% YoY increase in 1H24 earnings suggests that market consensus of just 10% full-year growth is way too conservative.  </li>
<li>Industry sales momentum for excavators and wheel loaders has accelerated in the last three months. A low base in 2H24 will mean an even stronger recovery.</li>
<li>Government supportive measures for equipment renewal and faster special purpose bond issuance will fuel demand too. We estimate net cash equals 90% of the share price. </li>
</ul>



Lonking Holdings (3339 HK)'s positive profit alert for 33-50% YoY increase in 1H24 earnings suggests that market consensus of just 10% full-year growth is way too conservative.  
Industry sales momentum for excavators and wheel loaders has accelerated in the last three months. A low base in 2H24 will mean an even stronger recovery.
Government supportive measures for equipment renewal and faster special purpose bond issuance will fuel demand too. We estimate net cash equals 90% of the share price. 


Lonking (3339 HK): Setting the Stage for Better Profitability

<ul>
<li>
<a href="https://www.smartkarma.com/entities/lonking-holdings-ltd" target="_blank" data-smartkarma-citation="entities:3944:1" rel="noopener">Lonking Holdings (3339 HK)</a>'s demand should pick up in 2H24 supported by the government's "Action plan to promote large-scale equipment renewals and consumer goods trade-ins". </li>
<li>Industry volume sales have already witnessed a narrower YoY decline in Mar, with solid exports of wheel loaders and domestic sales of excavators.</li>
<li>After going ex- in late-May, its PER will drop to 7.0x and yield will rise to 6.6%. Net cash of HK$1.56/share is more than fully cover its share price.</li>
</ul>



Lonking Holdings (3339 HK)'s demand should pick up in 2H24 supported by the government's "Action plan to promote large-scale equipment renewals and consumer goods trade-ins". 
Industry volume sales have already witnessed a narrower YoY decline in Mar, with solid exports of wheel loaders and domestic sales of excavators.
After going ex- in late-May, its PER will drop to 7.0x and yield will rise to 6.6%. Net cash of HK$1.56/share is more than fully cover its share price.


China

Zoomlion Heavy Industry Science and Technology Co., Ltd.manufactures and markets construction machinery.  The Company's products include concrete machinery, cranes, road machinery, drilling equipment, and other heavy construction equipment.  Zoomlion also produces environmental machinery and satellite navigation products.

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Zoomlion Heavy Industry S A (000157 CH)

Zoomlion (000157 CH) - 1H24 Earnings Below Expectation

Our TP for Zoomlion A/H is revised down to RMB10.5/HK$6.8 with 2024E target P/E multiple unchanged at 22x/13x. Maintain BUY.

CMB International

Zoomlion (1157 HK) - Right Strategy on Product & Global Expansion

We are convinced by Zoomlion’s impressive global expansion strategy. On the product side, the offering of full range of machinery through an...

CMB International

Zoomlion (000157 CH) - 2023 Net Profit in Line; Overseas Strategy a Successful Pay-Off

Zoomlion’s net profit in 2023 grew 51% YoY to RMB3.55bn, in line with the preannounced profit range of RMB3.38-3.62bn. Zoomlion proposed dividends...

CMB International

Lonking (3339 HK): Setting the Stage for Better Profitability

Lonking expects 1H24 earnings to grow by 33-50% YoY, signaling a much stronger full-year performance than market consensus. Industry sales...

Osbert Tang, CFA

Lonking (3339 HK): Policy Tailwind

Government policy support and improving industry demand should drive a potential uptick in sales for Lonking in 2H24. Attractive valuations and a...

Osbert Tang, CFA

Price Gauge

52-week Range

Market Cap (USDm)

P/E

Dividend (Yield)

Zoomlion (000157 CH) - 1H24 Earnings Below Expectation

Our TP for Zoomlion A/H is revised down to RMB10.5/HK$6.8 with 2024E target P/E multiple unchanged at 22x/13x. Maintain BUY.

CMB International

Zoomlion (1157 HK) - Right Strategy on Product & Global Expansion

We are convinced by Zoomlion’s impressive global expansion strategy. On the product side, the offering of full range of machinery through an...

CMB International

Zoomlion (000157 CH) - 2023 Net Profit in Line; Overseas Strategy a Successful Pay-Off

Zoomlion’s net profit in 2023 grew 51% YoY to RMB3.55bn, in line with the preannounced profit range of RMB3.38-3.62bn. Zoomlion proposed dividends...

CMB International

Lonking (3339 HK): Setting the Stage for Better Profitability

​Lonking expects 1H24 earnings to grow by 33-50% YoY, signaling a much stronger full-year performance than market consensus. Industry sales...

Osbert Tang, CFA

Lonking (3339 HK): Policy Tailwind

Government policy support and improving industry demand should drive a potential uptick in sales for Lonking in 2H24. Attractive valuations and a...

Osbert Tang, CFA

Lonking expects 1H24 earnings to grow by 33-50% YoY, signaling a much stronger full-year performance than market consensus. Industry sales...