Xingma Motor: Shares of heavy trucks increase profit or decline

In the first half of 2011, Xingma Motors fully diluted EPS0.96, which is estimated to have fallen by 0.7% year-on-year, which is lower than our previous forecast (including Valin Motors, which was calculated based on the total capital stock of 406 million after reorganization; both are preparatory financial data, the same below) . In the first half of 2011, the company realized revenue of 4.457 billion yuan, and achieved a net profit of 388 million yuan attributable to the parent company, which was estimated to have fallen by 0.7% year-on-year, achieving a fully diluted EPS of 0.96 yuan. Among them, Xingma Motors (excluding Valin) recorded a 19% year-on-year increase in revenue in the first half of 2011, and its net profit increased by 15.5% year-on-year. Valin Motors' revenue grew by 5% year-on-year, and its net profit fell by 11.1% year-on-year.

The revenue of concrete pump trucks doubled and the gross profit rate increased significantly. In the first half of 2011, the company's concrete mixer truck revenue increased by 19%, gross profit margin decreased by 0.42 percentage points; bulk cement truck revenue increased by 19.5%, gross profit margin decreased by 3.85 percentage points; concrete pump vehicle revenue increased by 107%, gross margin increased by 8.6 percentage points. The company's concrete pump truck technology has matured and its sales efforts have increased. As a result, the gross profit margin has increased significantly to 22.15%, and sales revenue has doubled.

The company's special-purpose vehicle business is expected to benefit from the construction of water conservancy projects and the start-up of guarantee houses. In July, the new construction area of ​​commercial housing in the country was YOY34.04%, which reached a new high during the year. From August to September, it was necessary to pay attention to whether the actual construction of water conservancy and affordable housing started. We expect that the protection housing will bring industry-specific opportunities for real estate-related concrete machinery. , The company will benefit as a leader in the segmentation of concrete mixers.

The market share of Hualing Heavy Trucks is rapidly increasing, but there is a risk of decline in earnings. From January to July 2011, Valin's heavy truck sales decreased by 2.7% year-on-year, better than the industry average of -9.2%, and the market share increased to 3.24%. The increase in market share was mainly due to the increase in the sales volume of Xingma’s special vehicles, which led to the growth of the chassis of Hualing’s special vehicles. Valin Auto's products are mainly high-end heavy trucks with a capacity of over 15 tons. The gross profit margin and profit margins are higher than the industry average. Due to the overall downturn in the heavy-duty truck industry, we expect 2011 sales of heavy-duty trucks by Valin Motors will be 29,000 vehicles, down 3.9% year-on-year. At the same time, the increase in raw material prices will have a greater impact on gross margins, and the company's heavy truck business profitability will continue to face downside risks in the short term.