Investment Rating - The report initiates coverage on the company with a "Buy" rating, setting a target price of 1.75 HKD based on a 5x PE for 2025, reflecting a total market capitalization of 5.58 billion HKD [5]. Core Insights - The company is positioned as a leading player in the construction equipment rental market, with a focus on expanding its overseas operations and leveraging a light asset model to maintain its competitive edge [1][2][4]. - The domestic high-altitude work platform rental market is stabilizing, with rental prices expected to rise, enhancing profit margins for the company [3]. - The company has demonstrated strong growth in revenue and net profit, with a projected net profit of 9/10.4/12.2 billion RMB for 2024-2026, reflecting a growth rate of -6.3%/+15.7%/+16.5% [1]. Summary by Sections Company Overview - The company is a leading high-altitude work platform rental provider in China, backed by its major shareholder, Far East Horizon. As of Q3 2024, it has a fleet of 214,800 high-altitude work platforms [1][12]. - The company has established a comprehensive service capability, integrating equipment rental, engineering services, and platform services [19]. International Expansion - The company is actively expanding its overseas presence through a "3+3+3" international strategy, targeting high-growth markets in Southeast Asia and the Middle East. It has established 44 overseas outlets across seven countries, with an overseas asset management scale exceeding 2.7 billion RMB [2][50][55]. - The profitability of overseas operations is significantly higher, with diesel arm vehicles priced three times higher than in China, while diesel costs are only half [2][52]. Market Dynamics - The domestic high-altitude work platform market has seen a significant increase in equipment ownership, with projections indicating a rise from 530,000 units in 2023 to 650,000 units in 2024. The company's market share in this segment has grown to 34% [3]. - The rental prices for high-altitude work platforms are expected to increase by 10% as major manufacturers have announced price hikes, indicating a favorable market environment [3]. Business Model and Financial Performance - The company has successfully implemented a light asset model, increasing its managed equipment from 4,600 units in 2021 to 72,600 units in H1 2024, with a significant rise in the proportion of light asset management [4][21]. - Revenue growth has been robust, with a CAGR of 38.28% from 2019 to 2023, and a projected revenue of 4.877 billion RMB in H1 2024, reflecting a 16% year-on-year increase [21][37].
宏信建发：低估值高空作业平台租赁龙头，海外布局打造成长新动能-20250221