GUOTAI HAITONG SECURITIES·2026-03-09 08:10Investment Rating - The report assigns an "Accumulate" rating for the industry, indicating a positive outlook for investment opportunities [4]. Core Insights - The industry is experiencing a cyclical recovery domestically, with structural improvements in export demand. The gradual implementation of counter-cyclical fiscal policies is expected to sustain the industry's positive momentum [2]. - Domestic sales of excavators are projected to rebound as the industry cycle turns upward, with leading companies enhancing their overseas presence and entering a harvest phase. The operational leverage within the industry is anticipated to gradually release [4]. Summary by Sections Industry Fundamentals - In February 2026, a total of 17,226 excavators were sold, representing a year-on-year decline of 10.6%. Domestic sales accounted for 6,755 units (including 19 electric excavators), down 42% year-on-year, while exports reached 10,471 units (including 16 electric excavators), marking a year-on-year increase of 37.2% [4]. - For January to February 2026, a total of 35,934 excavators were sold, reflecting a year-on-year growth of 13.1%. Domestic sales were 15,478 units (including 43 electric excavators), down 9.19%, while exports totaled 20,456 units (including 27 electric excavators), up 38.8% [4]. - The share of domestic sales in total sales for February 2026 was 39%, while exports accounted for 61%. For January to February 2026, domestic sales represented 43% and exports 57% of total sales [4]. Operating Hours and Rates - The average working hours for major construction machinery products in February 2026 was 55 hours, showing a year-on-year increase of 18.6% but a month-on-month decrease of 24.1%. Specific working hours included excavators at 48.2 hours and loaders at 69.9 hours [4]. - The operating rate for major construction machinery products in February 2026 was 35.9%, down 8.63 percentage points year-on-year and 12.2 percentage points month-on-month. Excavators had an operating rate of 36.5% [4]. Company Recommendations - Recommended stocks include SANY Heavy Industry, Zoomlion Heavy Industry, XCMG, Liugong, and Hengli Hydraulic, all expected to benefit from the industry's recovery and growth [4].