Sinotruk (Hong Kong) (3808 HK) Summary
Core Content
Sinotruk (3808 HK) reported a net profit of RMB5.86bn for 2024, which represents a 10% year-over-year (YoY) increase, but slightly below the consensus estimate. The company proposed a final dividend of HK$0.55 per share, leading to a total payout ratio of 55% for 2025, up from 50% in 2023. The management expects HDT industry sales to be 0.9-1.0mn units in 2025, with a 3% growth in China and a 5% decline in exports. The company revised its 2025 and 2026 earnings forecasts downward by 2% and 3%, respectively, due to lower export volume and low engine margins. The target price (TP) was adjusted to HK$20.50 from HK$21.40, based on a 5x EV/EBITDA multiple, and the recommendation remains HOLD. Weichai is preferred due to more growth drivers.
Key Financial Highlights
| Metric |
FY23A (RMB mn) |
FY24A (RMB mn) |
FY25E (RMB mn) |
FY26E (RMB mn) |
FY27E (RMB mn) |
| Revenue |
85,041 |
95,062 |
99,522 |
106,172 |
110,655 |
| YoY Growth (%) |
43.4 |
11.8 |
4.7 |
6.7 |
4.2 |
| Net Profit |
5,318.1 |
5,858.4 |
6,025.2 |
6,314.8 |
6,567.9 |
| EPS (Reported) |
1.93 |
2.14 |
2.18 |
2.29 |
2.38 |
| YoY Growth (%) |
196.0 |
10.9 |
2.1 |
4.8 |
4.0 |
| P/E (x) |
10.9 |
9.8 |
9.6 |
9.1 |
8.8 |
| P/B (x) |
1.4 |
1.4 |
1.3 |
1.2 |
1.2 |
| Yield (%) |
4.6 |
5.6 |
5.7 |
6.0 |
6.3 |
| ROE (%) |
14.0 |
14.4 |
14.2 |
13.9 |
13.5 |
| Net Gearing (%) |
(37.6) |
(32.5) |
(36.9) |
(43.7) |
(51.9) |
Segment Analysis
Heavy Duty Trucks (HDT)
- 2024 Sales: 243k units, up 7% YoY
- China Sales: 109k units, +13%
- Export Sales: 134k units, +3%
- ASP: Increased 5% YoY to RMB346k/unit
- Segment Profit: RMB4.4bn, +1.4% YoY
- Segment Margin: Narrowed to 5.2%, down 0.57ppt
- 2025E Forecast: 3% sales volume growth, driven by 12% growth in China and 5% decline in exports
Light Duty Trucks (LDT)
- 2024 Sales: 100k units, up 4% YoY
- ASP: Increased 4%
- Segment Loss: RMB215mn, narrowing from RMB623mn
- 2025E Forecast: 5% sales volume growth, with potential for a positive margin
Engine
- 2024 Volume: 109k units, down 15% YoY
- Segment Profit: RMB1.97bn, down 4%
- Segment Margin: Stable at ~14%
- 2025E Forecast: 5% volume growth, margin remains stable
Auto Finance
- 2024 Revenue: RMB1.48bn, up 7% YoY
- Segment Profit: RMB807mn, up 5% YoY
- Segment Margin: Slightly narrowed to 54.6%
- Forecast: Expected to remain relatively stable
Risks and Opportunities
Upside Risks
- Stronger-than-expected replacement demand
- Further expansion of new overseas markets
Downside Risks
- Further weakness in export sales
- Lack of demand recovery in China
Shareholding and Market Performance
- CNHTC: 51% ownership
- MAN SE: 25% ownership
- Market Cap (HK$ mn): 61,846.4
- Avg 3 mths t/o (HK$ mn): 84.5
- 52w High/Low (HK$): 24.65/15.90
- Total Issued Shares (mn): 2,761.0
Share Performance
| Period |
Absolute |
Relative |
| 1-month |
8.5% |
6.2% |
| 3-months |
-1.1% |
-15.2% |
| 6-months |
-2.0% |
-13.7% |
Key Assumptions and Projections
Sales Volume (Units)
| Segment |
2024 Actual |
2025E Forecast |
2026E Forecast |
2027E Forecast |
| Truck |
343,960 |
249,842 |
267,234 |
277,925 |
| HDT |
243,418 |
249,842 |
267,234 |
277,925 |
| China |
109,380 |
122,506 |
133,531 |
137,537 |
| Export |
134,038 |
127,336 |
133,703 |
140,388 |
| LDT |
100,542 |
105,569 |
110,848 |
116,390 |
| Engine |
109,104 |
114,559 |
120,287 |
123,896 |
| Internal Use |
103,540 |
108,717 |
114,153 |
117,577 |
| External Sales |
5,564 |
5,843 |
6,135 |
6,319 |
ASP (RMB/unit)
| Segment |
2024 Actual |
2023 Actual |
YoY Growth |
| Truck |
277,103 |
263,144 |
5.3% |
| HDT |
345,703 |
329,653 |
4.9% |
| LDT |
111,016 |
106,803 |
3.9% |
| Engines |
127,629 |
114,017 |
11.9% |
Valuation and Recommendations
- Target Price (TP): HK$20.50 (down from HK$21.40)
- P/E Ratio: 9.6 (FY25E), 9.1 (FY26E), 8.8 (FY27E)
- P/B Ratio: 1.3 (FY25E), 1.2 (FY26E), 1.2 (FY27E)
- Dividend Yield: 5.7% (FY25E), 6.0% (FY26E), 6.3% (FY27E)
- ROE: 14.2% (FY25E), 13.9% (FY26E), 13.5% (FY27E)
- Net Gearing: -36.9% (FY24A), -43.7% (FY25E), -51.9% (FY26E)
Analyst Ratings
- CMBIGM Rating: HOLD
- Target Price: HK$20.50
- Potential Return: +15% to -10% over next 12 months
Figures and Notes
- Figure 1: Changes in key assumptions for 2025E and 2026E
- Figure 2: Changes in key assumptions for 2025E, 2026E, and 2027E
- Figure 3: CNHTC monthly sales
- Figure 4: Sinotruk's HDT sales volume projection
- Note: CNHTC is the controlling shareholder of Sinotruk. The financial data includes intersegment sales and other adjustments.
