China's machinery and equipment industry sales situation has gradually improved

In May 2012, 28 major excavator manufacturers sold 10,870 excavators, down 23.92% year-on-year and 29.28% from the previous month. The total sales volume of the industry from January to May was 70,327 units, down 39.67% year-on-year. In May, demand fell by a much better-than-expected year-on-year. Excluding seasonal factors, excavator demand is gradually improving. According to the grassroots investigation, the overall inventory of dealers in May continued to decline compared with that in April, and the sales dealers in the second half of the year were more confident, especially for “Xiaoyangchun”. If the infrastructure projects are overweight in the third quarter, the sales of excavators will be reflected after September. Exports continued to grow substantially and the proportion increased. In May, 704 units were exported, an increase of 118.63% year-on-year, accounting for 6.48%, which continued to increase from 5.56% last month.

Orient Securities said it continues to be optimistic about the construction machinery industry. This round of economic stimulus may be more clearly related to infrastructure, and has a strong correlation with the demand for construction machinery. However, considering the profitability and valuation of listed companies in the industry, it is recommended to first focus on the industry leaders with good performance: Sany Heavy Industry (600031, stocks) (600031) (600031, unrated), Zoomlion (000157, stocks) (000157) (000157, not rated).