Commercial vehicles suffer from negative growth
In the first half of this year, the passenger car and commercial vehicle market can be described as “Icefireâ€: sales of passenger cars in the previous May increased by more than 20% year-on-year, while commercial vehicles declined by 1.6% year-on-year. This different performance determines the different trends of individual stocks in their respective fields. However, due to the gradual recovery of the macro economy, the government is continuing to increase commercial vehicle policy support, commercial vehicle listed companies are ushering in new investment opportunities. The latest research report released by a number of brokerage firms reminded that commercial vehicle investment opportunities will be even more in the second half of the year.
The recovery of the commercial vehicle market is imminent
At the beginning of this year, in order to promote the development of the automotive market, the state introduced measures to encourage consumption. Among them, halving the purchase tax for passenger cars of 1.6L and below and 10% for farmers buying mini-vehicle subsidies have greatly promoted people's enthusiasm for purchasing passenger cars. As a result, the passenger car market in the first half of the year has been advancing rapidly and showing explosive growth.
Commercial vehicles are another kind of scene. Although the policy of promoting automobile consumption has also provided preferential treatment for farmers to purchase light trucks, the preconditions for the scrapping of tricycles or agricultural vehicles have actually become a “bad check†for the vast majority of farmers, so this favorable policy has not declined. Really. Since then, while passenger vehicles have grown at a high speed, commercial vehicles have never been able to shake off the negative growth, which is actually expected.
However, the market began to change in the second half of the year. On the one hand, the government found that the encouragement policy for farmers to buy light trucks has not been implemented, and this month, it decided to change the "subsidy for purchase" of light trucks to the countryside to "direct purchase subsidies," which is expected to bring about a greater boost to the light truck market. On the other hand, China's macro economy is gradually recovering, and the recovery of the commercial vehicle market in the second half of the year is within reach.
Three major market segments stabilized
Specific to the various commercial vehicle market segments, the light-card market maintained a growth rate of around 5% in the first half of May and was encouraged by favorable policies in the second half of the year. The increase is expected to increase further. The favorable policies come from two aspects. First of all, the “subsidy for replacement†of light trucks to the countryside has become “direct purchase subsidiesâ€; on the other hand, it is the state-subsidized vehicle replacement scheme. These two favorable policies are expected to promote light trucks by more than 10% throughout the year.
Heavy trucks have a very prominent attribute of investment products. Although the sales of heavy trucks fell by more than 30% in the first five months, this was caused by the high base due to the earlier consumption caused by heavy truck nation III implementation last year. In fact, since the first half of the year, with the steady recovery of the macro-economy, sales of heavy trucks have increased on a month-on-month basis, which means that this market may have completed the process of bottoming out. At present, major engineering investment incentives for construction vehicles have increased, and the number of transportation vehicles has picked up significantly (13,000 units sold, 35% increase month-on-month), which will continue to drive demand for heavy trucks.
At present, the passenger car market is less optimistic. From January to May, the cumulative sales of passenger cars totaled 111.9 thousand, which was nearly 20% lower than the same period of last year, especially for large and medium-sized passenger cars. GF Securities analysts believe that this is mainly due to the decline in the tourism market and export market after the financial crisis.
Commercial vehicle sector investment opportunities appear
The downturn of commercial vehicles in the first half of the year and the hot trend of passenger cars have caused different trends in the stock prices of listed companies in the two major sectors. China International Capital Corporation believes that the current valuation of the entire automobile stocks has been relatively high, and there is limited room for improvement in valuation. The downturn of commercial vehicles in the first half of the year dragged down the stock price of this sector. Therefore, as the market rebounded in the second half of the year, investment opportunities began to appear.
Therefore, a number of brokerages remind investors to pay attention to investment opportunities in the commercial vehicle segment. CICC believes that investment in automobile stocks in the second half of the year should gradually shift from passenger vehicles to commercial vehicles and components. In the “Investment Strategy for the Automotive Industry in the Second Half of 2009†issued by Shenyin Wanguo, we also reminded that in the second half of the year, the heavy truck and light truck market will recover, and the large and medium-sized passenger market is expected to recover in the fourth quarter. We are optimistic about leading enterprises such as Foton Motors and Yutong Bus.
China Merchants Securities recommended a defensive product with strong short-term profitability and stable performance in its "European Monthly Report for the Automotive Industry" issued by it. Wang Liusheng, an analyst at China Merchants Securities, believes that in the second half of the year, there will be opportunities for investment in China’s heavy trucks and Huai Diesel Power, the leading heavy truck companies, in view of the sustained high growth rate of fixed asset investment and the recovery of the logistics market brought about by the macroeconomic recovery.