CICC: Maintains Sinotruk Jinan Truck (03808) Outperform rating, target price of 47.7 HKD.

CICC released a research report stating that it maintains the profit forecast for Sinotruk Jinan Truck (03808) for the years 2026/2027. It also maintains an outperform industry rating. The current stock price corresponds to a P/E ratio of 13.1/11.7 times for 2026/2027. The target price is maintained at HK$47.7, corresponding to a P/E ratio of 15.0 times for 2026, with an upside potential of 13.2% from the current level. Key points from CICC: Performance in 2025 meets expectations In 2025, the company's revenue increased by 15% year-on-year to 109.5 billion yuan, with net profit attributable to shareholders increasing by 20% to 7.02 billion yuan. In the second half of 2025, revenue increased by 27%/15% quarter-on-quarter to 58.7 billion yuan, with net profit attributable to shareholders increasing by 40%/5% quarter-on-quarter to 3.59 billion yuan. This meets the expectations of the bank. Steady market position in heavy trucks, with record-high revenue and profit in 2025 In 2025, the company's heavy truck sales increased by 20% year-on-year to 292,000 units, maintaining the leading market share in China. Domestic and international sales increased by 27%/14% to 139,000/153,000 units respectively. The bank's analysis shows that the per-unit revenue for heavy trucks decreased by -11,000 yuan to 331,000 yuan year-on-year, mainly due to the increasing proportion of exports of low-end models to regions such as Africa and Southeast Asia. The per-unit net profit for heavy trucks remained basically unchanged at 24,000 yuan, with non-recurring net profit per unit increasing by 2127 yuan to 20,000 yuan year-on-year. Stable profit capability, with ample cash on hand In 2025, the company's gross profit margin decreased by 0.5% year-on-year to 15.1%, while the expense ratio decreased by 0.5% to 8.3% and the net profit margin increased by 0.2% to 6.4%. By the end of 2025, the company had a net cash balance of 26.7 billion yuan; the total cash dividend proposed for 2025 was 40.3 billion yuan, accounting for approximately 57% of the net profit attributable to shareholders, demonstrating a continued high dividend payout to shareholders. In terms of business segments in 2025: 1) revenue from the heavy truck division increased by 13.7% year-on-year to 97.2 billion yuan, with an operating profit margin of 8.3%. 2) Revenue from the light truck and other divisions increased by 30.4% to 14.6 billion yuan, with an operating loss rate of 1.5%, showing a continuous decrease in losses. 3) The financial division's revenue increased by 20.6% to 0.74 billion yuan, with an operating profit margin increasing by 5.9% to 25.7%. Expecting long-term opportunities for Chinese heavy trucks to go global, as the leading players continue to strengthen According to the General Administration of Customs, exports of heavy trucks in January-February 2026 increased by 63.8% year-on-year to 68,000 units, continuing the strong momentum seen since the second half of 2025. The company has been deeply involved in overseas markets for over twenty years, with 37 KD assembly plants and over 700 service points and spare parts centers established overseas, and has begun to enter the European market through OEM cooperation. The bank is optimistic about the sustained growth potential of Chinese heavy trucks in Asia, Africa, and Latin America, as well as the long-term potential of entering the European market. As the leading player in heavy trucks, the company is expected to benefit from the increase in volume and profit. Risks: Demand for heavy trucks domestically and internationally falls short of expectations, increase in shipping costs, deterioration of industry competition.