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Zoomlion's Comprehensive Restructuring Delivers Confidence in Steady Development

Zoomlion's Comprehensive Restructuring Delivers Confidence in Steady Development 28.07.2015

On July 8, Zoomlion announced that the board of directors had authorized the company to repurchase a maximum of 10% of issued H shares, amounting to 143,002,888 shares. On July 10, the company implemented its first buyback, repurchasing a total of 19,853,800 H shares for HK$ 81,341,564.

Analysts believe that this initiative reflects management's confidence in the company's future sustained and stable development and will help further align the interests of the company's management and shareholders.

Transforming and Developing New Business Sectors

Hunan Provincial Party Committee Vice Secretary and Provincial Governor Du Jiahao said during an inspection of Zoomlion that the company is a Hunan institution and he hopes it will actively participate in the national "One Belt, One Road" strategy and the "Made in China 2025" action plan to accelerate transformation and upgrading and bring about positive changes.

In 2015, faced with the "new normal" in national macro-economics, Zoomlion has accelerated its transformation and upgrading and reorganized its engineering machinery sector while also developing its agricultural machinery, environmental industry, and financial sectors.

Since its acquisition of Chery Heavy Industries last year, Zoomlion has officially entered the agricultural sector and moved into the field of high-end agricultural machinery. Zoomlion already has the foundations to challenge the global environmental sector and is currently transforming itself into an environmental management solutions provider and investment operator. The establishment of Zoomlion Finance Co., Ltd. will also help realize the value of Zoomlion's financial services platform.

Market observers have stated that, looking at the past two years of ongoing transformation in the market, Zoomlion's move toward agricultural and sanitation machinery has helped to develop new economic growth points.

Intelligent Platform to Improve Manufacturing Efficiency

Zoomlion is undergoing two major transformations: from build-to-forecast production to build-to-order production, and from a traditional client service system to an intelligent service system.

It is reported that the openness and inclusiveness of Zoomlion's existing cloud platform will help the company to easily integrate successful business models in the era of Internet Plus. In terms of intelligent manufacturing, the cloud platform is helping Zoomlion to transform itself from a build-to-forecast producer to a build-to-order producer, which will increase order entry accuracy to 95% and increase prediction accuracy from its present level of 50-60% to 100%.

In terms of innovative marketing, the use of mobile terminal devices and applications such as WeChat supported by the cloud platform allow Zoomlion to communicate with customers free of barriers and provide customers with customized intelligent services.

Equipment Manufacturing is the Leading Development Highlight

Industry depth adjustment period, Zoomlion is actively implementing and enriching the Internet Plus concept and plan, carefully nurturing and developing an "artisan spirit," continuing to promote the overseas strategy, and exploring and creating new thinking and new paths for a Chinese version of Industry 4.0.

"This year the Premier stated in the government work report the importance of promoting the exportation of railroad and construction machinery and other Chinese equipment to the world, building the energy-saving and environmental protection industries into new pillar industries, and continuing to improve agricultural mechanization and science and technology. All of this is favorable for Zoomlion's development, and I believe 2015 will be a good year for the company," said Board Secretary Shen Ke.

For the equipment manufacturing industry, restructuring has already gone from research into key technologies and building a domestic industrial ecological chain to the international market penetration stage, making it a competitive industry with a competitive edge internationally. Long-term, the equipment manufacturing industry is bound to become a bright spot that will lead industry upgrading, expand international economic cooperation, and determine regional economic development strategies.