Guoyuan Securities: The development of construction machinery is promising under diversified catalysis, with large engineering projects driving a new growth engine

According to the Zhitong Finance APP, Guoyuan Securities released a research report stating that the number and scale of major engineering project investments across the country in 2025 will remain at a high level, with expectations for increased demand for construction machinery and equipment. The downstream hydropower project of the Yarlung Tsangpo River has officially commenced, driving demand for construction machinery. The total investment for this project is as high as 1.2 trillion yuan, and the expected procurement scale for construction machinery will reach 120 billion to 180 billion yuan. It is recommended to pay attention to Sany (600031.SH), XCMG (000425.SZ), and LIUGONG (000528.SZ).

The main points of Guoyuan Securities are as follows:

Industry Overview: Huge market size, industry chain connects upstream and downstream

Construction machinery is one of the important pillar industries of national economic development. Construction machinery has a wide range of applications, mainly including urban and rural roads, urban infrastructure construction, national defense, and water conservancy, with a broad application scope and a variety of types, belonging to capital, labor, and technology-intensive industries. According to data from the China Business Industry Research Institute, the market size of China's construction machinery is expected to reach USD 23.4 billion in 2024, accounting for approximately 11.0% of the global total, and is expected to grow to USD 57 billion by 2030, with a CAGR of about 16%. Excavators, cranes, and loaders occupy the main market space, and the trend is expected to improve in the future. Among them, the main construction machinery product, excavators, sold a total of 174,039 units from January to September 2025, a year-on-year increase of 18.1%. The construction machinery industry chain mainly includes upstream raw material component suppliers, midstream construction machinery manufacturers, and downstream covering multiple industries and fields. The domestic construction machinery industry has a high market concentration, with companies exhibiting a tiered competitive landscape. The global pattern shows a "tripod" situation, with Chinese companies transitioning from followers to leaders.

Development Trends: Policies stimulate growth potential, technological innovation and overseas expansion establish advantages

In recent years, China has introduced a series of important policies for the industry, providing strong support and guidance for the construction machinery industry. Most policy content revolves around the strategic goal of becoming a manufacturing powerhouse, focusing on key directions such as equipment updates in the industrial sector, green development of manufacturing, release of quality infrastructure efficiency, and deepening applications of intelligent manufacturing. The "Suggestions of the Central Committee of the Communist Party of China on Formulating the 15th Five-Year Plan for National Economic and Social Development" proposed in October 2025 emphasizes optimizing the position and competitiveness of industries such as machinery in the global industrial division of labor. China's construction machinery industry is ushering in a technological innovation wave centered on "intelligence, high-end, and greening," with leading manufacturers continuously driving industry upgrades through breakthrough product development. The construction machinery industry in China is actively exploring overseas markets through diversified market layouts and has achieved significant results. Chinese companies are accelerating their globalization layout through a strategy that combines "deep localization" and "global networking."

Risk Warning

Risks of policy implementation falling short of expectations; risks of macroeconomic and downstream demand fluctuations; competitive risks brought by technological upgrades and transformations; risks of stability in the industrial chain and supply chain; risks of international market expansion and geopolitical issues