Is the China's forklift market worth investing?

The threshold of forklift is not high, and the competitive environment is fierce. It has been paid low attention among A-share machinery companies. However, the forklift manufacturer told us that the forklift market is a huge market, with huge risks and opportunities. At present, the global forklift market space has exceeded 100 billion, which is second only to the construction machinery sub-industry of excavators. Forklift manufacturer knows that many enterprises are concerned about whether the China's forklift market is worth investing. Today, let's talk about this topic.

First of all, the forklift manufacturer believes that the forklift market is very worthy of investment. First of all, the sales of forklift trucks are closely related to the investment in manufacturing industry, and the investment in e-commerce logistics will drive the sales of forklift trucks. In the downstream of forklift trucks, the manufacturing and logistics demand is about 2:1. According to the survey, the forklift has a very close relationship with the output value of the manufacturing industry and the investment in fixed assets. Forklift manufacturer expects that the sales of forklift will continue to grow steadily with the growth of manufacturing investment. In recent years, the popularity of e-commerce has driven the rapid growth of express delivery volume, and also driven the investment in corresponding automatic sorting, warehousing, and handling equipment. Among them, the electric forklift is most benefited from the increase in logistics investment.

Secondly, the analysis of forklift manufacturers found that the margin elasticity of forklift is large. The historical gross profit rate of China's forklift industry has always been low, and due to the high cost of steel, it is greatly affected by the fluctuation of raw material prices. Forklift manufacturer analyzed the cost structure, and finally found that the raw material price was significantly correlated with the lagged gross profit rate through the lag regression analysis of the historical raw material price fluctuations and the historical gross profit rate data of the enterprise. According to the back-test results, if the price of raw materials falls by 20% this year, the gross profit margin of forklifts that lag two quarters will increase by 1.2 pct. This is very flexible for forklift manufacturers whose net interest rate hovers between 6-8%. At the same time, forklift manufacturer also found that the gross profit rate was significantly negatively correlated with the exchange rate, that is to say, the gross profit rate benefited from currency depreciation.

In addition, the current global requirements for environmental protection are increasing, and the competition pattern is expected to improve. The concentration of overseas forklift industry is high, but the concentration of China's forklift industry is low, the competition is fierce, and the profit margin is low. With the improvement of environmental protection requirements, the degree of product intelligence is becoming higher and higher, and the industry access threshold of forklift is also becoming higher and higher. China's forklift pattern is also expected to gather at the head. Therefore, from the above points of view, forklift manufacturer believes that China's forklift market is still very worthy of investment.