CITIC Securities Reaffirms Buy Rating on SANY Heavy Industry with HK$28 H-Share Target

Stock News
09/23

CITIC Securities has released a research report maintaining a target price of HK$28 for SANY HEAVY IND (06031) H-shares and RMB 27 for its A-shares, with a "Buy" rating on both listings. The firm also kept its net profit attributable to shareholders forecasts at RMB 10.9 billion, RMB 14.3 billion, and RMB 18.2 billion for 2026, 2027, and 2028, respectively, with the H-share target price corresponding to 23 times 2026 earnings.

The company reported first-half 2026 revenue of RMB 53.31 billion, up 19.7% year-on-year, and net profit attributable to shareholders of RMB 5.69 billion, up 9.1%. In the second quarter alone, revenue reached RMB 29.26 billion, up 24.6%, while net profit rose 16.9% to RMB 3.21 billion. Revenue growth in the first half was robust, driven by gains across both domestic and international markets, with overseas revenue climbing 21.8% to account for 61.3% of total core revenue.

Profitability was somewhat affected by exchange losses from RMB appreciation and higher credit impairment charges. However, overseas gross margins remained impressive at 32.5%, up 1.3 percentage points year-on-year. Looking ahead to the second half, CITIC Securities believes domestic demand for construction machinery will continue its gradual recovery. With ongoing improvements in overseas channels, services, and localized manufacturing, the company's global market share gains remain well-supported. As revenue scales up, the product mix improves, and lean operations deepen, the company's mid-to-long-term profitability is expected to keep rising.

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