Xin Lang Cai Jing·2025-05-08 00:31Financial Performance - In Q1 2025, the company reported revenue of 12.117 billion yuan, a year-on-year increase of 2.9%, and a net profit attributable to shareholders of 1.41 billion yuan, up 54.0% year-on-year, exceeding expectations mainly due to asset disposal gains [1] - The company's gross margin improved to 28.7%, an increase of 0.2 percentage points year-on-year, driven by a higher proportion of overseas revenue, which grew by 15.17% year-on-year, with export growth around 20% [1] - Operating cash flow showed significant improvement, with net cash inflow from operating activities reaching 739 million yuan, an increase of 432 million yuan year-on-year [1] Industry Trends - The domestic revenue of the engineering machinery sector is expected to achieve positive growth in 2025, with excavator domestic sales increasing by 38.3% year-on-year in Q1 2025, and export sales up by 5.5% [2] - The company’s products, particularly cranes and concrete-related products, have a higher proportion compared to peers, indicating that domestic revenue is significantly influenced by non-excavator demand, with expectations for a rebound in domestic revenue this year [2] Earnings Forecast and Valuation - The company maintains EPS forecasts of 0.58 yuan for 2025 and 0.73 yuan for 2026, with current A-shares trading at 13x/10x P/E for 2025/2026 and H-shares at 9x/7x P/E [3] - Target prices are set at 9.36 yuan for A-shares and 7.58 HKD for H-shares, representing an upside potential of 24.14% and 32.29% respectively, with a maintained outperform rating for the industry [3]