CICC: Focus on the traditional cycle and long-term opportunities for the machinery industry overseas
The downstream demand and investment intensity in the current machinery industry are generally weak, with the midstream demand in a weak recovery trend. CICC focuses on the traditional cycle and long-term opportunities for the machinery industry, recommending structural opportunities including shipbuilding, rail transit demand, mining equipment demand, special equipment demand, and the long-term export growth opportunities brought by the increase in Chinese companies' overseas market share. At the same time, attention is given to the export demand for general equipment, domestic substitution, and the field of consumer goods, as well as the new technological changes in special equipment and mining equipment. In terms of the consumer goods sector, the overseas inventory reduction of consumer goods is ending, waiting for interest rate cuts to drive the recovery of terminal demand. In the real estate and transportation equipment sector, rail transit investment is recovering, the shipping cycle remains strong, and real estate investment is under pressure
According to the financial news app Zhitong Finance, CICC released a research report stating that the current downstream demand and investment intensity are generally weak, and the midstream machinery industry demand is in a weak recovery trend. Looking ahead, the team recommends structural opportunities, including ship and rail transit demand brought by replacement and supplementation, energy and mining equipment demand driven by resource prices, specialized equipment demand brought by new technological changes, and long-term export growth opportunities brought by the increase in Chinese companies' overseas market share.
General Equipment: Focus on export demand, domestic substitution, and consumer sectors. 1) General Automation: Tool stock price adjustment is thorough, CICC expects marginal improvement in growth rate in 2H24, and humanoid robots are expected to recover sentiment in the second half of the year; 2) Injection Molding Machine: Leading orders grew rapidly in 1H24, with domestic orders exceeding export orders; 3) Forklift: Structural growth in domestic demand, medium to long-term lithium electrification driving international development trend unchanged; 4) Industrial Gases: Focus on demand recovery and regional layout integration.
Specialized Equipment: Focus on new technological changes and energy and mining equipment. 1) Photovoltaic Equipment: Sector valuation is low, focusing on new technology iteration opportunities; 2) Lithium Battery Equipment: Domestic bidding growth still under pressure, focusing on new technologies; 3) Composite Flow Collection: Mass production is underway, industrialization is about to start; 4) PCB: A new round of expansion cycle is starting, focusing on new technologies in glass-based circuit boards; 5) Textile Machinery: Domestic inflection point recovery in 1H24, focus on Davis double-click opportunity. 6) 3C Automation: Apple layout AI phone, equipment order inflection point can be expected. 7) Metal Mining Equipment: Global capital expenditure accelerating, seeking layout opportunities. 8) Oilfield Equipment: North America electric drive replacing diesel drive, overseas natural gas compression equipment continues to break through.
Consumer Track: Overseas consumer goods destocking ends, waiting for interest rate cuts to drive terminal demand recovery. 1) Hardware Tools: Destocking cycle ends, OPE terminal demand exceeds expectations, focus on trends in interest rates and real estate market changes; 2) Third-party Testing: Pressure on the base in the second half of the year eases, focus on changes in downstream segment prosperity, and continuous increase in market concentration. 3) Scientific Instruments: Domestic substitution in progress, focus on industry policy drive.
Real Estate and Transportation Equipment: Rail transit investment recovery, continuous prosperity in the shipping cycle, pressure on real estate investment: 1) Ships: New round of continuous cycle prosperity, Chinese shipbuilding competitiveness continues to improve; 2) Construction Machinery: Short-term domestic small excavator growth, overseas markets continue to decline, increase in Chinese market share; 3) Railway Equipment: Demand for high-speed trains is prosperous, focus on expanding rail transit overseas business.
Risks
Changes in overseas markets/industry competition exceed expectations, downstream prosperity/new product and technology promotion fall short of expectations