Excavator grows 80% in the first two months Zoomlion targets HK$25

Zoomlion is one of the leading enterprises in the construction machinery industry in the Mainland. It sells on the global scale under the "Zhonglian" and "CIFA" brands. Currently, it covers more than 70 different countries, ranking second in the mainland, and ranking in the world. The 10th place. The company's main products are concrete pump trucks, construction cranes and ring cranes, among which tower cranes with large tonnage rank first, and their lifting capacity is currently the first in the world. The market share of concrete machinery remained stable and continued to maintain a duopoly pattern with Sany.

In 2010, it achieved operating revenue of 32.193 billion yuan (renminbi. same below), an increase of 55.05%; net profit of 4.666 billion yuan, an increase of 90.71%; weighted average return on net assets of 33.41%, earnings per share of 0.79 yuan. Due to the decrease in raw material prices during the period and improvement in product mix, the company's overall gross profit margin increased by 4.1% year-on-year.

The promotion of affordable housing in the Mainland will have a positive impact on the construction machinery industry. According to the data, the sales of mainland excavators increased by more than 80% in the first two months of this year, sales of concrete machinery increased by more than 50%, and sales of other construction machinery products also increased by more than 30%. The continuous deepening of the protection of housing effects will stimulate the continued rise of related stocks. It is expected that the Group's earnings per share for 2011 to 2012 will be 1.1 yuan and 1.5 yuan respectively, with a target price of 25 Hong Kong dollars and a stop loss of 17 Hong Kong dollars.