20240201-招银国际-HDT_sales_volume_surged__64__YoY_in_Jan_on_low_base_4页_737kb

Summary

HDT Sales Performance

• China's Heavy-Duty Truck (HDT) sales volume surged ~64% YoY in January 2024 to approximately 80,000 units, driven by a low base effect from an early Chinese New Year in 2023 and postponed sales from December 2023.
• Adjusting for seasonal impacts, the sales volume was up 27% compared to the average of the first two months in 2023.

Full-Year Forecast

• Maintain an 17% year-on-year growth forecast for the HDT industry in 2024, supported by replacement demand and resilient exports.

Stock Recommendations

• Weichai (2338 HK/000338 CH): Rated "BUY" with recognition of market share gains driven by natural gas engines.
• Sinotruk (3808 HK): Rated "BUY" based on export-driven growth potential and positive earnings forecasts.

Financial Analysis

• Payback Period: Gas HDTs have a shorter payback period at 2.9 years vs. 3.4 years for diesel HDTs due to lower fuel costs.
• Profitability: With current LNG at RMB5.2/kg and diesel at RMB7.1/litre, an LNG truck generates higher annual net profit (RMB159k) than a diesel truck (RMB110k), making gas trucks more financially attractive.

Note

• Analyst certification confirms subjective views and adherence to ethical standards, with risks disclosed in the report affecting investment outcomes.