However, the industry has likely bottomed out, says Phillip Securities analyst Zhang Jing. “With the further implementation of the government’s policies to stabilize the economy, infrastructure investment and logistics demand will maintain the momentum of the rally, which will provide a foundation for the recovery of the heavy truck market,” writes Zhang in his June 13 report. He has upgraded the stock to “buy”.
Besides building heavy trucks, Sinotruk’s product portfolio includes light trucks, buses and major powertrains and parts. The customers range from those in the infrastructure, construction, container service, logistics, mining, steel and chemical industries.
The overall market was down last year but Sinotruk has been able to stand out and outperform. For its FY2022 ended December 2022, the company reported earnings of RMB1.8 billion ($336.2 million), down 58.4% y-o-y.
