Citigroup: Shipments of excavators in mainland China significantly accelerated in March.

Citibank released a research report stating that, according to statistics from the China Construction Machinery Industry Association, with the gradual recovery of demand after the Spring Festival, the domestic excavator shipments in China in March increased by 23% year-on-year to 24,101 units, showing accelerated growth compared to the first two months which had a year-on-year decrease of 9%. Driven by the demand recovery in March, the first quarter excavator shipments in China reached 39,579 units, an 8% increase year-on-year; Export performance remains strong, with a 36% year-on-year increase in exports in the first quarter. The bank believes that the strong shipment data in March will help boost the currently pessimistic market sentiment, as the market was previously concerned that rising oil prices would increase construction costs and weaken demand for construction machinery. The bank maintains its preference order for original equipment manufacturers of mechanical equipment, favoring ZOOMLION (01157) the most, followed by Sany Heavy Industry (06031) and Sany Heavy Industry (600031.SH) A-shares. The bank remains relatively cautious on the Chinese railway equipment sector, maintaining a "neutral" rating on Zhuzhou CRRC Times Electric (03898) and a "sell" rating on CRRC Corporation (01766).