\u3000\u3 Shengda Resources Co.Ltd(000603) 348 Wencan Group Co.Ltd(603348) )
Stock selection logic: the dimension of price benefits from the increment of electrification, and the dimension of quantity benefits from the large volume of high-growth customers of new forces, mastering the underlying process and continuing category expansion
Based on the “volume price” framework of auto parts investment and Research (auto parts growth path and investment and research framework: price and volume, upgrading and breaking the situation), the ad valorem dimension of the company’s growth benefits from the increase of single vehicle value brought by the upgrading of Lightweight Technology (integrated die casting) under the incremental logic of electrification, The dimension of volume benefits from the large volume of new power customers with strong growth. The company itself belongs to the type of mastering the bottom process of high vacuum integrated aluminum die casting and continuing category expansion based on process homology.
The industrial trend of integrated die casting technology of body structure parts is clear
Integrated die casting of body structure parts is an inevitable choice for lightweight, cost reduction and efficiency improvement in the automotive industry. Led by Tesla and followed by new forces such as weixiaoli, Ford, Volvo, Volkswagen and other traditional OEMs have gradually changed from hesitation to transformation. Tesla, Wencan and others will take the lead in breaking through the integrated die-casting process of the rear floor in 2021, and the industrialization will be significantly accelerated in 2022: 1) the integrated die-casting parts of Tesla‘s lower body will be expanded from the rear floor to the front engine room and front floor, and the new capacity of factories in Shanghai, Berlin and Dezhou will become the focus of the layout; 2) Wei Xiaoli, a new force in Chinese car making, is following up quickly, and the rear floor of et5 and other models will be mass produced within the year; 3) Local Tier1 and Volvo and other foreign-funded automobile enterprises have made clear the integrated die-casting layout.
There is a large market space of 100 billion yuan, and the moat of technology and assets is high
Integrated die casting is a scarce track whose value of single car can gradually break 10000 with technological breakthrough. We estimate that the global space can reach 585 billion and the Chinese space can reach 175.5 billion. From the perspective of pattern, integrated die casting has the characteristics of heavy assets and low turnover. Some new forces are personally involved in the short term due to supply guarantee factors, but it is not a long-term trend. China Tier1 accelerated its layout, significantly leading foreign enterprises. The integrated die-casting body structural parts have the characteristics of large size, thin wall and complex structure. They have high requirements for strength and elongation. They need to use heat-free materials, large die-casting machines and molds, high vacuum die-casting process manufacturing, etc. they have more know-how. At the same time, the integration has significantly improved the asset barrier.
The technology accumulation of body structural parts is profound, the core competence is extended to integrated die casting, and the technical barrier of body structural parts is high. The company benefits from the training of Mercedes Benz, the training of new forces and other mainstream car enterprises. It has a deep accumulation of know-how for high vacuum die casting and other processes, and the ability of self-made molds is the leader in the industry. It is one of the few in China that can supply Mercedes Benz, Weilai Tier1 of body structure parts of Tesla and many other OEMs. The homology between body structure parts and integrated die casting technology is strong, and the company’s ability can be postponed. It has been involved in integrated die casting since the second half of 2020. At present, it has been designated as the rear floor project, and has significant first mover advantages in technology accumulation, industrial layout and order acquisition.
Investment suggestion: in 21 years, dragged down by the public’s lack of core and the rise in the price of raw materials, considering the recovery of capacity utilization and the stabilization of aluminum price in the later stage, the profit is expected to be repaired. The breakthrough of new products of integrated body structure parts and the growth of new forces drive the volume of revenue. We expect the revenue of 21-23 years to be RMB 4.043/52.42/6.916 billion respectively, a year-on-year increase of + 55% / + 30% / + 32%; The net profit was 81 / 314 / 524 million yuan respectively, with a year-on-year increase of – 3.2% / + 286% / + 67%, maintaining the “buy” rating.
