[Epoch Times October 31, 2021](Epoch Times reporter Li Bing comprehensive report) With the adjustment of the Chinese Communist Party’s real estate policy and infrastructure investment, the sales of construction machinery in the mainland have gradually weakened. Sany Heavy Industry, a leading Chinese construction machinery company, has seen its stock price go down since its peak in February this year, and the company’s market value has evaporated by more than 200 billion yuan. Zoomlion, also a leader in construction machinery, also saw a sharp drop in its net profit in the third quarter.
On the evening of October 28, Sany Heavy Industry released a performance report showing that the operating income of the third quarter decreased by 13.14% compared with the same period of the previous year, and the net profit decreased by 35.32% year-on-year.
On the day of Sany’s announcement, Sany’s share price plunged 5.3% to close at 22.86 yuan (RMB, the same below), and its market value fell to 194.1 billion yuan, a record low since September 2020.
The share price of Sany Heavy Industry reached its highest point of 50.3 yuan in February 2021, and has since fallen all the way. It plummeted by about 55% in eight months, and its market value has evaporated by more than 200 billion yuan.
Sany Heavy Industry is mainly engaged in the manufacture and sales of concrete machinery, road machinery, crawler cranes and other machinery. From 2016 to February this year, the stock price has risen nearly 10 times and is known as “Machinery”.
“Jianjie News” reported that the excavator, as the main product of Sany Heavy Industry, is a barometer and weather vane of the construction machinery industry. The unsatisfactory performance of Sany Heavy Industry in the third quarter has a lot to do with the downward trend of the industry.
According to the statistics of 25 excavator manufacturers from China Construction Machinery Industry Association, in September 2021, 20,000 excavators of various types were sold, a year-on-year decrease of 22.9%. This is the fifth consecutive month of year-on-year decline in the data. In September, China’s excavator sales fell by 38.3% year-on-year, which is the sixth consecutive month of decline.
Zoomlion, also a leader in construction machinery, also saw a sharp drop in its net profit in the third quarter. The performance report of Zoomlion showed that the operating income of the third quarter decreased by 27.04% compared with the same period of the previous year, and the net profit decreased by 46.01% year-on-year.
Flush (“stock software”) construction machinery sector index fell 2.67% overall on October 28, and only three of the 21 concept stocks rose slightly. As of the close of the day, Zoomlion fell 3.52%.
According to a report from Chinanet.com, entering 2021, with the regulation of China’s real estate industry and adjustment of infrastructure investment, the driving force for sales of construction machinery is weakening.
In addition, since 2021, commodity prices have risen sharply, and the manufacturing industry is generally facing rising costs. This has also caused market investors to worry about Sany’s cost-side pressure, which has affected investors’ optimism about Sany to a certain extent.
Editor in charge: Lin Yan#
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