BOCOM INTL: Maintains "buy" rating on Weichai Power (02338) and raises target price to HK$44.5.

BOCOM INTL released a research report stating that the target price of Weichai Power (02338) H shares has been raised to HK$44.5, maintaining a "buy" rating. Looking ahead to the second to third quarter of 2026, the bank believes that the core increment has shifted from the traditional heavy truck cycle recovery to a growth logic driven by central power, large bore engines, and SOFC. The bank believes that Weichai's valuation logic is transitioning from a leader in the heavy truck cycle to a "global computing infrastructure power core supplier". The synergy of traditional engines and heavy truck industry chain forms a profit base, KION efficiency improvement provides profit elasticity, while AIDC power, large bore engines, and SOFC open up a second growth curve, maintaining a buy rating. If data center orders, overseas production capacity, and SOFC demonstration plans continue to materialize, the company is expected to break through the traditional manufacturing valuation range. In the first quarter of 2026, Weichai Power's operating income was 62.563 billion RMB, an 8.87% year-on-year increase; net profit attributable to shareholders was 3.085 billion RMB, a 13.83% increase year-on-year; and net operating cash flow was -2.716 billion RMB, a significant improvement compared to -4.646 billion RMB in the same period last year. Profit was slightly below market consensus expectations.