Weichai Power: Benefiting From HDT Market Growth And Industry Consolidation

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About: Weichai Power Co., Ltd. (WEICY)
by: The Value Pendulum
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The Value Pendulum
Deep Value, growth at reasonable price, contrarian, micro-cap
Summary

China's HDT market is showing signs of strong growth momentum with December 2019 sales up +9% YoY and being the sixth consecutive month of positive sales growth.

Besides HDT sales, industry consolidation and other businesses (apart from the HDT and HDT engine businesses) are also key growth drivers for Weichai Power in the medium to long term.

Weichai Power trades at 11.2 times consensus forward FY2020 P/E and offers a consensus forward FY2020 dividend yield of 3.7%.

Elevator Pitch

The share price of Hong Kong-listed Chinese heavy duty truck or HDT engine manufacturer Weichai Power Co., Ltd. (OTCPK:WEICY) (OTCPK:WEICF) [2338:HK] is up by +67% (excluding dividends) in the