Truth behind collective badmouthing of machinery

Through the first half year of 2012, the situation from the reports of the engineering machinery (sand making machine) reflects a collective monotonous badmouthing. However, it is not the case as the imagination. 2012 is doomed to be a stagnant year. As far as this problem is concerned, we should be cautious and prudent as well. According to the analyst, engineering machinery is still a promising industry.

The engineering machinery: the ignored faint hope. Currently, the investors seem to lose confidence in the further performance of the engineering machinery. But from the approval of the project by the Development and Reform Commission in May to close basis between the Ministry of Railways in July, it has become a relatively certain event that infrastructure is going to recover under a slow growth. Nevertheless, the regulation of the real estate has no original tools, which is conductive to maintaining the expected stability of the real estate. We still hold the judgment that the engineering machinery sales will outstrip the season and excess return rate of the engineering machinery shares will reappear.

Coal machinery: it is going to enter an excess return period at the end of the third quarter. Recently, a large-scale adjustment occurs to the A shares of coal machinery stock, which is intrigued by several factors like domestic coal demanding growth declines as well as the negative impact on the coal price brought by the imported coal. After the fall, the PE and PB valuation from the A share Coal Machinery Company has fully integrated with the internation. It is estimated that the impact in Mar. from the import coal is about to decrease, and before Apr.—the season for storing coal, approaches, the coal machinery is hopeful to get restored and regain excess return. 

Energy machinery: Pull the shale gas development trigger. The second round of prospecting tender of the shale gas is proceeding in August, we have specifically analyzed three elements influencing the development of Chinese shale gas, they are economy, political support and technical feasibility. We hold that the shale gas development in the 12th Five-Year period belongs to a technical reserves phase, while a real breakthrough will happen during the 13rd Five-Year period.

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