SHANTUI(000680) KAIYUAN SECURITIES·2024-12-02 12:00Investment Rating - The report assigns a "Buy" rating for the company, Shantui Co., Ltd. (山推股份) [2] Core Views - Shantui is a leading player in the domestic earthmoving machinery sector, with significant growth potential in both bulldozer and excavator markets. The company is backed by Shandong Heavy Industry Group, which enhances its competitive edge. The report anticipates substantial revenue and profit growth in the coming years, driven by the expansion of high-power bulldozer exports and the revival of the excavator business [7][9][10]. Summary by Sections Company Overview - Shantui is recognized as a domestic leader in earthmoving machinery, focusing on bulldozers, excavators, and related parts. The company holds a 10% global market share in bulldozers and less than 1% in excavators, indicating significant market potential [7][9]. Financial Performance - In the first half of 2024, Shantui achieved revenues of 6.52 billion yuan and a net profit of 410 million yuan, reflecting year-on-year increases of 34% and 38%, respectively. The company expects net profits to reach 950 million yuan, 1.24 billion yuan, and 1.5 billion yuan from 2024 to 2026, with corresponding P/E ratios of 16.5, 12.6, and 10.4 [7][11]. Bulldozer Segment - The demand for high-power bulldozers is surging, with Shantui's exports of large bulldozers increasing by 73% in 2023. The company commands a 65% market share in the domestic bulldozer market and 19% globally, particularly excelling in the high-power segment with a gross margin of 46.9% [8][10]. Excavator Segment - Shantui is revitalizing its excavator business through strategic partnerships and market-oriented procurement. The company aims to capture a larger share of the excavator market, which presents substantial growth opportunities given its current global market share of only 1% [9][10]. Resource Integration and Management - The company has undertaken multiple equity structure adjustments to optimize its business and management efficiency. The focus on high-margin products like excavators and large bulldozers is expected to enhance profitability. The gross margin for the excavator segment is currently lower than industry peers, indicating room for improvement [10][11]. Market Expansion - Shantui is actively expanding its overseas market presence, with overseas revenue reaching 3.6 billion yuan in the first half of 2024, a 44% increase year-on-year, accounting for 56% of total revenue. The company aims to achieve total revenue of 14 billion yuan in 2024, with 8.5 billion yuan expected from international markets [52][54].