Saic Motor Corporation Limited(600104) (600104)
Market share: the trend of bottom recovery is gradually clear
1. In the field of new energy, many swords strike at the same time. Before October 2021, the company's market share in Shanxi Guoxin Energy Corporation Limited(600617) CRRC was 21.7%. In terms of splitting: 1) SAIC's passenger car market accounts for 6%, and Zhiji automobile and Feifan automobile have important new cars in 2022; 2) SAIC GM Wuling accounts for 15% of the market, and Wuling has formed a platform + diversified use method with miniev as the fulcrum; 3) SAIC Volkswagen ID series has completed the launch of main products, and ID3 is expected to help sales to a higher level; 4) SAIC GM's special energy platform has been ready for a long time, and Cadillac lyriq will be delivered in 2022. The company has maintained its industry share before the two major joint ventures (Volkswagen and GM) have made efforts. The subsequent independent launch of new products of two large and medium-sized high-end brands, the volume of Volkswagen ID series and the launch of models on GM's special energy platform can ensure the company's market share in the field of new energy.
2. Overseas market performance led by China. Since 2008, SAIC passenger car has established an overseas business department to explore the way to open up the international market. 1) In terms of volume, SAIC's export volume has maintained an overall growth trend since 2008, with a compound growth rate of 25.6% from 2008 to 2020; 2) In terms of China's share, the company's exports accounted for 28.5% in the first three quarters of 2021, ranking first in China. The company's export business has helped the company stabilize the impact of weak demand in the Chinese market in the short term, and will open the ceiling of the company's market space in the long term.
3. Replenishment increases sales elasticity, and the market share of each vehicle plate is expected to rise gradually. Based on the performance of the retail market (traffic compulsory insurance): SAIC passenger cars and SAIC GM Wuling have achieved a steady recovery in the market share in the first October of 2021. The sales volume of SAIC Volkswagen and SAIC GM is basically stable, and the pressure of weak product lines has been fully released (such as SAIC Volkswagen Skoda and SAIC GM Chevrolet), the inventory depth of both has decreased for more than one month in the past year. It is expected that they will make up quickly after the shortage of chip supply is relieved. Generally, we expect the market share of SAIC's complete vehicle plates to gradually bottom out and rise.
Profit: price recovery + structural adjustment. Single vehicle profit is flexible. The automotive industry has been in the buyer's market for a long time. The current tight supply environment is a friendly environment for the improvement of single vehicle profitability, which is mainly reflected in: 1) the supply shortage caused by the lack of core gives the main engine plant the autonomy in model scheduling, and the main engine plant gives priority to the supply of high gross profit models, resulting in the optimization of model structure; 2) Tight supply leads to the rise of terminal discount recovery / average price. At present, a considerable proportion of this part of profit elasticity is eroded by high-priced chips. With the improvement of chip supply margin, profit elasticity is expected to be partially released.
Investment suggestion: we believe that the company's market share is expected to rise in 2022. Historical data show that there is a significant positive correlation between the company's market to book ratio and market share. It is expected that the upward market share will promote the repair of the company's valuation. We expect the company to achieve operating revenue of 800.54 billion yuan, 855.69 billion yuan and 962.85 billion yuan in 2021, 2022 and 2023, corresponding to net profit attributable to the parent company of 28.06 billion yuan, 30.06 billion yuan and 34.51 billion yuan. Calculated at today's closing price, PE is 8.4 times, 7.8 times and 6.8 times, maintaining the "buy" rating.
