Seven departments issued a document to promote the renewal of equipment in the industrial field, and the performance of listed machine tool companies is gratifying

Seven departments, including the Ministry of Industry and Information Technology, the National Development and Reform Commission, the Ministry of Finance and the People's Bank of China, jointly issued the Implementation Plan for Promoting Equipment Renewal in the Industrial Field to promote large-scale equipment renewal in the industrial field, including machine tools and other related equipment. In terms of enterprises, a number of A-share companies have actively deployed machine tools-related fields to accelerate the growth of related orders.

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Seven departments issued documents to promote the renewal of equipment in the industrial field, and the replacement of machine tools is ready to go

According to the news of the Ministry of Industry and Information Technology on April 9, the Ministry of Industry and Information Technology and other seven departments jointly issued the "Implementation Plan for Promoting the Renewal of Equipment in the Industrial Field" (hereinafter referred to as the "Implementation Plan"), and pointed out in the key tasks that it is necessary to implement advanced equipment renewal actions. In terms of speeding up the replacement of backward and inefficient equipment, it is required to speed up the elimination of backward and inefficient equipment and outdated equipment for industries with production equipment such as industrial machine tools, agricultural machinery, construction machinery, and electric bicycles at a medium and low level. Among them, it is emphasized to focus on promoting the industrial machine tool industry to update machine tools that have been in service for more than 10 years.

At the same time, the "implementation plan" also proposes to implement digital transformation actions, promote the application of intelligent manufacturing equipment, and require the transformation of production operations, warehousing and logistics, quality control and other links to promote the update of CNC machine tools and basic manufacturing equipment, additive manufacturing equipment, industrial robots and other general intelligent manufacturing equipment.

Machine tools are known as the "mother of industry", and its development level is of great strategic significance for the improvement of the overall level of a country's manufacturing industry.

According to the "Economic Operation of the Machine Tool Industry in 2023" released by the China Machine Tool Industry Association, in 2023, the machine tool industry will achieve an operating income of 1,097.4 billion yuan and a total profit of 113.2 billion yuan. In terms of metalworking machine tools, since 2011, metalworking machine tools have generally shown a downward trend in import fluctuations and a continuous upward trend in exports. In June 2023, with the metal cutting machine tools turning into a trade surplus, all 9 commodity areas of machine tools achieved a trade surplus. For the full year of 2023, exports of metalworking machine tools increased by 25.4% year-on-year to US$7.78 billion.

According to the National Bureau of Statistics, the added value of industrial enterprises above designated size increased by 7.0% from January to February 2024. From the perspective of the output of major industrial products above designated size, from January to February 2024, the output of metal cutting machine tools will be 90,000 units, a year-on-year increase of 19.5%.

Donghai Securities pointed out that with the transformation and upgrading of the manufacturing industry, higher requirements are put forward for the speed, precision and efficiency of production and processing, and high-end manufacturing products such as five-axis CNC machine tools and robots are expected to be promoted. At present, the numerical control rate of domestic machine tools still needs to be improved, the proportion of low-end CNC machine tools such as three-axis and four-axis is still high, and the application scenarios such as industrial robots and collaborative robots still need to be enriched. With the support of policies, the demand for advanced equipment transformation and upgrading may be further released.

The machine tool business of a number of listed companies performed well

In the A-share market, a number of listed companies are actively deploying in the field of machine tools and continuously promoting the growth of related businesses.

Guangdong Topstar Technology Co., Ltd. (stock abbreviation: Topstar; stock code: 300607. SZ) is a company with a complete product line in the general equipment industry, with industrial robots, injection molding machines and CNC machine tools as the core of intelligent equipment. The company's CNC machine tool products mainly include five-axis linkage CNC machine tools, high-speed machining centers, CNC grinding machines, etc., which are mainly used in civil aviation, precision molds, general parts, auto parts and other manufacturing fields. In the first half of 2023, the company's CNC machine tool business achieved operating income of 139 million yuan, a year-on-year increase of 42.08%.

From the perspective of CNC machine tool orders, the company disclosed in the investor relations activity record form on November 14, 2023 that from January to September 2023, the company's five-axis linkage CNC machine tool signed orders reached 188 units, a year-on-year increase of nearly 45%, and the shipment volume was 156 units, a year-on-year increase of more than 70%, maintaining rapid growth. At present, the company's CNC machine tool order schedule is still in a full state. In addition, the company launched a new economic five-axis linkage machine tool, which is cost-effective and has a certain market substitution space.

Guangdong Genesis Intelligent Equipment Group Co., Ltd. (stock abbreviation: Genesis; stock code: 300083. SZ) is mainly engaged in the research and development, production and sales of CNC machine tools. The company's CNC machine tool business has a complete research, production, supply, marketing and service system, covering metal cutting machine tools and non-metal cutting machine tools, and is one of the enterprises with the widest technical width and the most complete product width among the same type of enterprises in China. The company has four large-scale self-owned industrial bases in Dongguan, Suzhou, Huzhou and Yibin in South China, East China and Southwest China.

According to the company's investor relations activity record form on November 16, 2023, the company's CNC machine tool products are divided into 3C series and general series. Specifically, 3C series products include drilling and tapping machines and carving machines. Up to now, the company's drilling and tapping rig has been updated and iterated to the seventh generation, with a total of more than 90,000 units shipped worldwide, and it has been successfully selected as a single champion product in the national manufacturing industry in 2022, and the product market share continues to lead. The general series of products include vertical machining centers, horizontal machining centers, gantry machining centers, CNC lathes, etc. Among them, the shipment of vertical machining centers has doubled for four consecutive years, and by 2021, the shipment volume will exceed 10,000 units, ranking first in the country. Up to now, the company's vertical machining center has shipped more than 35,000 units worldwide, which has become the company's foundation work in the general field.

Wuhan Huazhong CNC Co., Ltd. (stock abbreviation: Huazhong CNC; stock code: 300161. SZ) takes CNC system technology as the core, and has three main business segments: CNC system for machine tools, industrial robots and intelligent production lines, and new energy vehicles. In 2023, the company's CNC system and machine tool products will achieve operating income of 892 million yuan, accounting for 42.18% of operating income, a year-on-year increase of 26.22%, and gross profit margin of 38.65%, a year-on-year increase of 2.76 percentage points.

In the research activity information released by the company on March 27, 2024, it said that in 2023, in the field of high-end CNC systems, the company's five-axis technology has made great progress, and the high-end route of CNC systems will continue to advance, and a new Huazhong 8-type high-end five-axis CNC system product package and turning and milling composite product package will be launched. In terms of sales, the sales volume of high-end CNC systems in 2023 will increase by nearly 60% year-on-year.

At the same time, the company's subsidiary, Huazhong CNC (Wenling) Research Institute Co., Ltd., is stepping up investment in the construction of CNC system base, accelerating the entry into the field of CNC machine tools in Zhejiang Province, accelerating the transformation of CNC machine tool enterprises to digitalization, networking and intelligence, and better serving the transformation and upgrading of the machine tool industry in the region.

In addition, Yuhuan CNC (002903. SZ), Hongyuan Green Energy (603185. SH), Qinchuan Machine Tool (000837. SZ) and many other listed companies are also actively in the field of machine tools.