Guotai Junan Securities: Maintains XCMG Machinery's "Outperform" rating, expected to fully benefit from the recovery of engineering machinery.

Guosen Securities research report pointed out that in 2024, Xugong Machinery's revenue decreased by 1.28% year-on-year, while its net profit attributable to the parent company increased by 12.20% year-on-year. The net profit attributable to the parent company in Q1 2025 was 2.022 billion yuan, an increase of 26.37% year-on-year. The increase in the proportion of overseas business has helped improve the company's profitability. In terms of product breakdown, in 2024, the company's earthmoving machinery, pile driving machinery, and concrete machinery showed a growth trend, with revenues of 24.011 billion yuan, 5.023 billion yuan, and 6.362 billion yuan respectively, an increase of 6.43%, 45.21%, and 8.55% year-on-year. However, the revenue of concrete machinery, lifting machinery, and aerial work machinery decreased slightly, with revenues of 9.408 billion yuan, 18.898 billion yuan, and 8.678 billion yuan in 2024, down by 9.76%, 10.80%, and 2.31% year-on-year. In 2024, benefiting from the construction of agricultural water conservancy and the renewal and iteration cycle of engineering machinery, products like excavators in earthmoving machinery first showed signs of recovery. In 2025, as the recovery of excavators spreads to non-excavators, the company's business is expected to continue growing. As a leading domestic engineering machinery company with a complete product range, the company is expected to fully benefit from the recovery of engineering machinery. Guosen Securities maintains a "better than market" rating.