Summary of Shantui Co., Ltd. Conference Call Company Overview - Shantui Co., Ltd. is a leading player in the engineering machinery industry, primarily engaged in the production of bulldozers and excavators. The company is part of Shandong Heavy Industry Group, which includes other well-known enterprises such as Weichai Power and China National Heavy Duty Truck Group [2][3][10]. Key Points and Arguments - **Revenue Composition**: Over 70% of Shantui's revenue comes from overseas markets, with expectations for overseas revenue to reach 9 billion yuan in 2025, representing a 21% year-on-year growth. However, the company needs to monitor the impact of the weakening Russian market on performance [2][3]. - **Profit Contribution**: Mining machinery contributes over 40% of Shantui's net profit, with high-power bulldozers being a significant source of profit. The company is expected to benefit from domestic substitution trends and demand from emerging markets, enhancing profitability [2][3]. - **Share Buyback and Market Confidence**: Shantui plans to repurchase shares worth 150 to 300 million yuan for employee stock ownership plans and has initiated an application for a listing on the Hong Kong Stock Exchange, indicating confidence in future growth. However, the potential dilution effect from the Hong Kong listing should be considered [2][3]. - **Market Position**: Shantui ranks third globally in bulldozer sales, with over 70% market share in the Chinese export market, indicating a monopolistic position. The company must remain vigilant regarding market strategies from competitors like Caterpillar and Komatsu [2][3]. - **Financial Performance**: In the first half of 2025, Shantui's total revenue was 7 billion yuan, a 3% increase year-on-year. The gross margin for main engine business was 24%, with overseas market revenue accounting for 56%, up 8% year-on-year, while domestic market growth was relatively slow [2][9]. - **Future Profit Projections**: Shantui expects net profits for 2025-2027 to be 1.35 billion, 1.75 billion, and 2.55 billion yuan, respectively, with a compound annual growth rate (CAGR) of 23%. The price-to-earnings (PE) ratios are projected to be 11, 8, and 7, indicating a low valuation compared to peers [4][20]. - **Market Layout**: Shantui's market is primarily focused on Africa, Indonesia, the Middle East, and other Belt and Road Initiative countries, with Africa holding the highest share at 30%-40%. The demand for engineering machinery in these regions is expected to grow steadily [5][13]. - **Management Changes**: Recent management changes include the appointment of Li Shizheng as chairman and Zhang Ming as general manager, both of whom have extensive experience in the industry, which is expected to positively influence the company's future development [10][11]. Additional Important Information - **Cost Reduction Measures**: Shantui has implemented cost reduction measures totaling 520 million yuan, aimed at significantly lowering operational costs and improving overall profitability [19]. - **Risks to Consider**: Investors should be aware of potential risks, including lower-than-expected infrastructure and real estate investments and overseas trade friction, which could adversely affect future performance [21]. This summary encapsulates the key insights from the conference call regarding Shantui Co., Ltd.'s business operations, market position, financial performance, and future outlook.

Investment Rating - The report maintains a "Buy" rating for the company [6]. Core Views - The company achieved steady revenue growth with a notable increase in non-recurring net profit, driven by overseas business expansion and domestic business transformation [2][3]. - The company has established four overseas subsidiaries and is accelerating its dealer network layout in key regions, contributing to a positive trend in overseas business development [2]. - The company’s gross margin improved by 1.1 percentage points to 20.2%, and net profit margin increased by 0.4 percentage points to 8.1% in the first half of 2025 [2]. Summary by Sections Financial Performance - In the first half of 2025, the company reported revenue of 7.0 billion yuan, a year-on-year increase of 3.0%, and a net profit attributable to shareholders of 570 million yuan, up 8.8% [1]. - The non-recurring net profit reached 560 million yuan, reflecting a significant year-on-year growth of 36.5% [1]. - For Q2 2025, revenue was 3.7 billion yuan, showing a year-on-year increase of 3.2% and a quarter-on-quarter increase of 12.2% [1]. Revenue Breakdown - The main engine machinery sales generated revenue of 5.13 billion yuan, a year-on-year increase of 7.5%, accounting for 73.3% of total revenue [3]. - Overseas business revenue reached 3.9 billion yuan, growing by 7.7% year-on-year, contributing to approximately 43% of the annual target [2]. Profitability and Cost Control - The company’s comprehensive gross margin improved to 20.2%, with a net profit margin of 8.1% in the first half of 2025 [2]. - The company effectively controlled costs, with selling expenses increasing by 31% due to higher sales incentives [2]. Future Outlook - The company’s net profit forecasts for 2025-2027 have been raised by 8.2%, 7.8%, and 3.9% respectively, indicating a positive outlook for profitability [3]. - The current stock price corresponds to a PE ratio of 11, 9, and 8 for 2025-2027, suggesting attractive valuation levels [3].

Core Viewpoint - The construction of major projects in Jining City is accelerating, serving as a stabilizing force for growth and an important means to optimize the economic structure. High-quality industrial projects are being launched, contributing to regional economic development and creating new growth momentum [12][15]. Group 1: High-Quality Industrial Projects - The Kolun Alloy New Materials R&D and Production Project in Jiaxiang County features advanced automation, producing zinc-aluminum-magnesium plates with high heat resistance, 10 to 20 times that of traditional galvanized steel [13]. - The project has introduced 20 new production lines, aiming for an annual output of 400,000 tons of zinc-aluminum-magnesium plates and 200,000 tons of electroplated chromium plates, generating an annual output value of 2.6 billion yuan and tax revenue of 470 million yuan, while creating 270 jobs [14]. - The Hengwang Green Intelligent Manufacturing Base for large and medium-sized construction machinery has completed its first phase and is set to start the second phase, focusing on smart technology and green processes [14][15]. Group 2: Infrastructure Projects - Major infrastructure projects are being expedited, including the construction of the Xiongshang High-Speed Railway Yellow River Bridge, which utilizes advanced technologies for precision construction [17]. - Multiple highway projects are progressing, with the Jining to Shangqiu Highway expected to enhance regional connectivity and promote economic development [18]. - The Jizhou Highway project has completed 94.2% of its earthworks and 44.6% of its road surface works, with an expected early completion [18]. Group 3: Government Initiatives - The Jining government aims to accelerate major project construction, implementing the "1113" investment expansion plan, focusing on 1,100 key projects, including 10 projects over 10 billion yuan and 30 projects over 3 billion yuan [19]. - The government is encouraging social capital participation in advanced manufacturing and urbanization projects, maintaining a 70% share of private investment [19].

齐鲁晚报.齐鲁壹点记者陈丹 重大项目建设既是稳增长的"压舱石"，又是优化经济结构的重要抓手。今年以来，济宁市项目建设加速推进。 宁德时代（300750）新能源产业电池基地、恒旺年产绿色智能制造基地等一批科技含量高、技术性强、产业高优质 产业项目顺利投产，锻造发展新引擎，莱赛尔纤维等项目也在全力推进，大干实干的风潮遍布齐鲁大地。与此同 时，多条高速公路建设提前实现"双超半"目标，港航建设迎来新进展，区域路网铺就城市内畅外联之路。 优质产业项目 据了解，该项目项目投资8.6亿元，新上锌铝镁板材、盐酸洗等生产线20条，项目全部投产后，年产锌铝镁板材40 万吨、电镀铬板材20万吨、聚合氯化铁2.4万吨，实现年产值26亿元、利税4.7亿元，带动就业270人。 另一方面，恒旺年产3000台大中型工程机械绿色智能制造基地项目一期已建成投用，项目二期也将适时启动。公司 总经理刘小伟表示，绿色智能制造基地以智能技术驱动生产，以绿色工艺降耗减排，以全链协同优化资源，尽管是 重型机械生产企业，新建车间均达到"无尘"标准。同时，新厂房通过MES系统进行生产管理和调度执行，以更优方 案完成订单任务。随着新生产线逐步达产，大马力推土机、 ...

Group 1 - Shandong Heavy Industry Group reported a total revenue of 289.8 billion yuan, a year-on-year increase of 6%, and a total profit of 14.97 billion yuan, up 6.9%, leading the industry and ranking first among provincial enterprises [1] - The company sold 212,000 heavy trucks in the first half of the year, achieving a market share of 40.9%, maintaining its position as the global leader in heavy truck sales [1] - China National Heavy Duty Truck Group, a subsidiary, secured the top position in the domestic heavy truck industry, achieving the highest sales in various segments such as express delivery, cold chain transportation, and containers [1] Group 2 - The sales of new energy heavy trucks surged by 242% year-on-year, positioning the company as the industry leader, with comprehensive coverage of new energy technology and six application scenarios [2] - The proportion of high-end products continued to rise, with the data center power generation business of Weichai growing by 664% year-on-year, and significant export orders for electric buses to regions including Europe, the Middle East, and the Americas [2] - The company emphasizes focusing on its core business and deepening innovation to establish a solid foundation for global leadership in the competitive equipment manufacturing industry [2]

Investment Rating - The report maintains a "Buy" rating for the company, expecting a relative return of over 20% within the next six months [8][18]. Core Views - The company reported steady performance in Q1 2025, with revenue of 3.301 billion yuan, a year-on-year increase of 2.86%, and a net profit attributable to shareholders of 273 million yuan, up 13.63% year-on-year [1]. - The company is accelerating its transformation towards high-tech, high-quality, and high-value-added products, with a significant increase in the number of new products developed [2]. - The integration of high-quality resources within the group has led to a complete and efficient production system, leveraging economies of scale and competitive advantages [3]. - The chairman proposed a share buyback plan, demonstrating confidence in the company's long-term development and aiming to stabilize and enhance company value [4]. - Profit forecasts for 2025-2027 indicate net profits of 1.37 billion, 1.57 billion, and 1.83 billion yuan, respectively, with corresponding PE ratios of 9.6, 8.3, and 7.1 times [5]. Financial Performance - In Q1 2025, the company achieved a gross margin of 19.2%, a slight decrease of 0.3 percentage points year-on-year, while the net profit margin increased by 0.8 percentage points to 8.3% [1]. - The company’s revenue is projected to grow from 10.54 billion yuan in 2023 to 19.97 billion yuan in 2027, with a compound annual growth rate of approximately 10.28% [6]. - The net profit attributable to shareholders is expected to grow from 765 million yuan in 2023 to 1.83 billion yuan in 2027, reflecting a robust growth trajectory [6]. Strategic Developments - The company has successfully launched new products such as skid steer loaders and excavator loaders, enhancing its high-end product line [2]. - The acquisition of Shanzhong Construction Machinery has been completed, with performance commitments for 2024-2026 expected to be exceeded, contributing positively to the company's earnings [2].

Investment Rating - The report maintains a "Buy" rating for the company, expecting a relative return of over 20% within the next six months [8][18]. Core Views - The company reported steady performance in Q1 2025, with revenue of 3.301 billion yuan, a year-on-year increase of 2.86%, and a net profit attributable to shareholders of 273 million yuan, up 13.63% year-on-year [1]. - The company is accelerating its transformation towards high-tech, high-quality, and high-value-added products, with a significant increase in the number of new products developed [2]. - The integration of high-quality resources within the group has led to a complete and efficient production system, leveraging economies of scale and competitive advantages [3]. - The chairman proposed a share buyback plan, demonstrating confidence in the company's long-term development and aiming to stabilize and enhance company value [4]. - Profit forecasts for 2025-2027 indicate net profits of 1.37 billion, 1.57 billion, and 1.83 billion yuan, respectively, with corresponding PE ratios of 9.6, 8.3, and 7.1 times [5]. Financial Performance - In Q1 2025, the company achieved a gross margin of 19.2%, a slight decrease of 0.3 percentage points year-on-year, while the net profit margin increased by 0.8 percentage points to 8.3% [1]. - The company’s revenue is projected to grow from 10.54 billion yuan in 2023 to 19.97 billion yuan in 2027, with a compound annual growth rate of approximately 10.28% [6]. - The net profit attributable to shareholders is expected to grow from 765 million yuan in 2023 to 1.83 billion yuan in 2027, reflecting a strong growth trajectory [6]. Business Strategy - The company has successfully launched new products such as skid steer loaders and excavator loaders, enhancing its high-end product line [2]. - The acquisition of Shanzhong Construction Machinery has strengthened the company's business integrity and is expected to contribute significantly to future earnings [2].

盈利预测、估值与评级：公司大马力推土机产品优势明显，海外营收表现突出，公司利润率稳步提升。 我们维持25-26 年归母净利润预测，新增27 年归母净利润预测，预计公司25-27 年归母净利润分别为 12.2/14.6/17.5 亿元。随着海外市场的持续开拓，我们认为公司作为大马力推土机龙头，主机业务未来 可期，成长空间广阔，维持"买入"评级。 风险提示：国际局势不稳定风险；海外市场拓展不及预期；汇率风险；原材料价格波动的风险，关税不 确定性风险。 分产品来看，2024 年公司工程机械主机产品收入97.63 亿元，同比增长26.6%，毛利率为23.1%，同比 +0.6pct；工程机械配件及其他收入31.45 亿元，同比增长30.2%，毛利率为11.5%，同比略有提升。公司 2024 年主机产品的量利齐增是核心亮点，随着高端产品线不断丰富，主机业务未来可期。 分地区来看，2024 年国外片区收入74.11 亿元，同比增长26.1%，占总收入的57.4%，毛利率为27.4%， 同比+0.5pct；国内片区收入54.97 亿元，同比增长29.4%，毛利率为10.8%，同比+0.5pct。 事件：4 月23 日山推股份 ...