Huada Automotive Technology Corp.Ltd(603358) Hengyi introduced war investment to strengthen the advantages in the field of battery box

\u3000\u3000 Huada Automotive Technology Corp.Ltd(603358) (603358)

Event:

The company announced that Jiangsu Hengyi, a subsidiary of the company, introduced two strategic investors, chendao new energy and Chaoxing entrepreneurship, by increasing capital and shares. After the introduction, the company held 45.8% of the equity of Jiangsu Hengyi and remained the controlling shareholder. The two strategic investors jointly held 10.2% of the equity of Jiangsu Hengyi.

Introduce strategic investors to the next city in the field of battery box.

The strategic investors introduced by Jiangsu Hengyi this time are chendao new energy (limited partnership) and Chaoxing Entrepreneurship (limited partnership), of which chendao new energy is a Contemporary Amperex Technology Co.Limited(300750) affiliated investment company. Jiangsu Hengyi is deeply engaged in the field of new energy battery boxes, of which Contemporary Amperex Technology Co.Limited(300750) is an important customer of Jiangsu Hengyi, and the company has built a production capacity of 200000 sets in Ningde, Fujian, so as to realize the nearby layout of customers. After introducing Contemporary Amperex Technology Co.Limited(300750) affiliated investment companies as strategic investors this time, the company will further strengthen cooperation with industry leaders Contemporary Amperex Technology Co.Limited(300750) and is expected to fully enjoy the dividends of the development of new energy vehicles.

The battery box business is developing rapidly and the layout is integrated in the field of die casting.

The company’s downstream customers of Jiangsu Hengyi cover Contemporary Amperex Technology Co.Limited(300750) , Yutong Bus Co.Ltd(600066) , Xiaopeng automobile and other customers, and continue to develop GAC new energy, SAIC, Byd Company Limited(002594) Toyota and great wall, with a capacity of one million sets. At the same time, the company has made in-depth cooperation with Hangda new materials and expanded to the field of integrated die casting by taking advantage of Beihang’s technical advantages in the field of lightweight. Hangda new material has low-pressure die-casting, differential pressure die-casting, high-pressure die-casting and other die-casting processes. The company will apply the existing process of Hangda new material to promote the implementation of integrated die-casting.

Investment advice

We estimate that the company’s EPS from 2021 to 2023 will be 0.78 yuan, 1.01 yuan and 1.38 yuan respectively. Maintain the “buy” rating.

Risk tips

Macroeconomic downturn; Risks such as lower than expected mass production of new process reserves.

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