In the future, with the back-up effect of the policy, equipment utilization is expected to pick up, demand in the construction machinery industry is expected to be marginally restored, and China Dragon Engineering is expected to benefit.
The Zhitong Finance App learned that Everbright Securities released a research report stating that maintaining the “buy” rating of China Longgong (03339), the 24-25 EPS forecast remained unchanged, and the net profit forecast for the year 26 was 1.11 billion yuan, corresponding to the 26-year EPS of 0.26 yuan. The company's demand for construction machinery is expected to benefit from a steady growth policy. The long-term development trend is good, and there is broad scope for overseas exports. The company's net profit bottomed out in 2023, profitability rebounded, and dividends declined.
According to the report, the construction machinery industry is still at the bottom. As most of the additional 1 trillion treasury bonds issued in 23Q4 are carried over to use this year, combined with the government work report, it is estimated that an additional 1 trillion ultra-long-term special treasury bonds will be issued this year, which will be converted into physical investment one after another, and infrastructure investment is expected to continue to improve. Considering that the effects of macroeconomic policies are lagging behind, construction machinery is currently at the bottom of demand. In the future, with the underpinning effect of the policy, equipment utilization is expected to pick up, demand in the construction machinery industry is expected to be marginally repaired, and the company is expected to benefit deeply as a leading domestic construction machinery company.
On the export side, due to high demand due to insufficient production capacity supply in overseas markets and the continuous increase in the international competitiveness of the company's products in recent years, the overseas market achieved sales revenue of 3.07 billion yuan in 2023, an increase of 20.1% over the previous year. Overseas sales revenue increased from 23.0% in 2022 to 29.2% in 2023. As the company's overseas layout deepens and construction machinery export trends continue to strengthen, the company's overseas business revenue is expected to continue to grow.