Himfr.com Reports The valve industry, market optimism

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China International Marine Containers Group, Zhenhua Port Machinery, Sany Heavy Industry, Anhui Heli, Hudong Heavy on the market these recent hot topic in the analyst's computer years, have been assigned to the mechanical section. Merrill Lynch has recently submitted a research report to clients said the China National Machinery, equipment, localization of import substitution the increasing tendency, which will promote the development of related domestic industries.

Sales growth slowed
Guoxin Securities analyst Guo Yaling, senior machinery industry that the slowdown in the second half as the impact of investment in fixed assets appear, machinery industry growth will come down significantly, while sub-sectors will appear divided. He said that the first half of the industry total sales revenue increased 27.91% year on year growth rate was down 9 percentage points; the same time, due to rising costs, gross margins fell 1 percentage point. Role in two ways, the industry profit noticeable decline, in which ordinary machinery and instrumentation manufacturing industry has declined by a big margin.

One container, bearing valves, motors, boilers, manufacturing, and other sub-sectors in the economy during the first half to continue to run high, the cumulative total profit growth rate were maintained at 40% or more; and special instruments, electronic measurement, measuring equipment, engineering machinery, etc. appeared the sales decline in revenue, a marked decline in the profit situation; however, rail transportation equipment, shipbuilding machinery manufacturing industry, the few bright spots.

Guo Yaling expects the second half of machinery industry will continue to be a downward path, annual growth rate of about 25%, down 7 percentage points. Part of the economy at a high sub-sectors such as container, bearing, valves, motors, general-purpose instrumentation, will be faced with high fall risk; and early fall the larger sub-sectors such as construction machinery, it is expected to gradually stabilized; shipbuilding, railways transportation equipment manufacturing industry are expected to continue to maintain recovery momentum. With the steel prices are expected in the second half of the decline, industry gross margin is expected to stabilize or rise slightly.
Machinery industry is facing increasing pressure from rising costs, owing to the steel, oil, electricity, transportation, human resources, the price rising. Since income growth slowed while costs are rising, machinery industry showed significant declines in gross margins.

Decline in income growth, gross profit margin decline in the context of the profit growth the industry has also seen a sharp decline. The first half of the industry profit growth of 124.17 percent from the same period last year dropped to 25.23%. In which ordinary machinery manufacturing, special equipment manufacturing, instrumentation equipment, the total profit growth rate of the manufacturing sector, also from last year's 126.77%, 88.39% and 104.1% respectively in May of this year dropped to 32.58%, 10.53% and 17.96%, decline was relatively clear.

Differentiation of sub-sectors boom
The declining growth rate in the industry as a whole against the backdrop of various sub-sectors machinery industry appears divided. According to the first 5 months of statistical data, container, bearings and valves, agricultural machinery, metallurgy, mining equipment, electrical machinery, general instrumentation, boilers, high manufacturing sector continue to maintain the economy, the cumulative total profit growth rate were maintained at 40% or more; and special instruments and meters, electronic measurement, measuring equipment, engineering machinery, and several other sub-sectors have seen a sales decline in revenue, a marked decline in the profit situation; in the machinery industry as a whole degree of decline in the economy against the backdrop of rail transportation equipment, shipbuilding two sub-sectors from past losses into profits, the industry noticeable signs of recovery.

Within the industry in the machinery, basic parts such as bearings, valves, and other common components of most mechanical equipment the upstream industry, macro-economic, or investment in fixed assets of the slowdown in the first large-scale machinery and equipment will lead to slowdown in demand, and then affect their the basis of the upper parts industry, it is generally speaking, the basic parts of the economy to lag behind changes in the climate changes in machinery and equipment.

Guo Yaling said that in the machinery industry-wide against the backdrop of declining growth rate is expected to fall by a big margin in the first half of the special equipment manufacturing, instrumentation, manufacturing and transportation equipment manufacturing industry will become more stable in the second half; and by the lagged effect of , general machinery manufacturing (including boilers, metal processing machinery, general equipment, bearings and valves, other common parts) in the second half drop rate would be increased to exceed the industry average.

Previous period due to reasons such as the economy is still lagging in the high part of the sub-industries such as container, bearings and valves, electrical and general instrumentation industry cautious is expected that these sub-sectors may be in the short term to reach the high point of the economy and then will appear a certain degree of decline. The early decline in the larger sub-industries such as construction machinery may be due to the small base of a certain degree of recovery. And rail transportation equipment, and shipbuilding, it is expected to continue an upward trend.

Article Source: http://depositarticles.com/

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