LONKING (03339) saw its shares climb more than 8% in Hong Kong trading, with the stock last changing hands at HK$3.195, up 8.31%, on turnover of approximately HK$25.25 million.

The rally follows the company's earlier profit alert, forecasting net profit for the first half of the year to reach between RMB 730 million and RMB 800 million, representing a year-on-year increase of 16% to 27%.

This anticipated growth is attributed to the company's aggressive efforts to develop and refine its product portfolio, alongside continued expansion into both domestic and international markets, which has driven steady growth in production and sales volumes during the reporting period. Additionally, the group's quality improvement and cost control initiatives have proven effective, leading to an enhanced overall gross margin for its products.

Industry data from the China Construction Machinery Association underscores a favorable operating environment. In July 2026, excavator sales reached 19,521 units, up 13.9% year-on-year. Notably, exports surged 21.2% to 11,913 units, pushing the export share to a record high of approximately 61%. Loader sales also demonstrated robust growth, climbing 30.8% to 11,774 units.

For the January-to-July period, cumulative excavator sales rose 24.8% year-on-year, reflecting sustained positive momentum across the sector. Analysts at Pacific Securities express confidence in the continued upward trajectory of both domestic and overseas markets, maintaining a bullish outlook on the construction machinery sector.

Where to focus next: Market participants are closely monitoring whether the strong export demand and domestic infrastructure spending will sustain the sector's growth narrative through the remainder of the year.