Market review: affected by the Russian Ukrainian incident, some overseas enterprises shut down factories, the global supply chain is tight, and the automobile sector continues to adjust this week. This week (3.14-3.18), the overall SW automobile sector was -0.64%, ranking 9 / 31. SW passenger car segment + 0.17%, SW commercial vehicle – 2.82%, SW auto parts – 0.77%, SW Auto Service – 1.31%, SW motorcycle and others – 1.31%. From the perspective of valuation level, the overall PE of SW auto sector was callback to 35.0 times, which was 59.4% of the past five years, and the PE of SW auto parts sub sector was callback to 34.7 times, which was 40.1% of the past five years.
Industry status: from March 7 to 13, China retailed 320000 passenger cars, a year-on-year increase of 3%, a month on month increase of + 23%, and a year-on-year increase of + 75% over the previous month. Steel, aluminum, copper and other raw materials and freight prices are still high.
Stable supply still needs time, and the price of electric vehicles continues to rise. From January to February this year, the added value of industries above designated size increased by + 7.5% year-on-year, 3.2pct faster than December 2021 and 1.4pct faster than the average growth rate of two years in 2021. The economic recovery in the first two months was better than expected. Since 2022, the prices of raw materials such as power batteries and bulk commodities have continued to rise, the supply of superimposed chips is insufficient, and the operation pressure of automobile enterprises is great. Since March, affected by the epidemic situation in China, the uncertainty of the international situation and the earthquake in Japan, there is still great uncertainty in the price trend of chip supply and raw materials, and it will take time for the supply chain to stabilize. To this end, a number of auto companies raised the price of new energy vehicles to cope with the cost pressure, ranging from thousands of yuan to tens of thousands of yuan. This week, Tesla, Byd Company Limited(002594) , Chery, Nezha and Xiaopeng announced price increases. On March 18, the Ministry of industry and information technology issued the key points of automobile standardization in 2022 to clarify a number of standards. Previously, the two sessions have set steady growth, emphasized supply chain guarantee, and continued to support the consumption of new energy vehicles. All aspects of policy support will contribute to the recovery of the industrial chain.
Investment suggestion: electrification and intellectualization of automobiles are still the general trend of the industry. It is suggested to continue to pay attention to three main lines: electrification & lightweight: the boom of new energy demand is determined, and the penetration rate continues to increase. It is suggested to pay attention to: Byd Company Limited(002594) , Ningbo Tuopu Group Co.Ltd(601689) , Wencan Group Co.Ltd(603348) , Nanjing Chervon Auto Precision Technology Co.Ltd(603982) , Zhejiang Shuanghuan Driveline Co.Ltd(002472) , Ningbo Xusheng Auto Technology Co.Ltd(603305) , Ikd Co.Ltd(600933) , etc; Intellectualization: intelligent cockpit and intelligent driving are accelerated, and the intelligent configuration of new cars is continuously improved. It is suggested to pay attention to: Huizhou Desay Sv Automotive Co.Ltd(002920) , Foryou Corporation(002906) , Bethel Automotive Safety Systems Co.Ltd(603596) , Anhui Zhongding Sealing Parts Co.Ltd(000887) , Shanghai Baolong Automotive Corporation(603197) , Ningbo Jifeng Auto Parts Co.Ltd(603997) , Suzhou Sonavox Electronics Co.Ltd(688533) , etc; Improvement of core shortage: traditional automobile enterprises are greatly impacted by core shortage. With the improvement of supply, enterprise operation is expected to improve. It is suggested to pay attention to: Changzhou Xingyu Automotive Lighting Systems Co.Ltd(601799) , Keboda Technology Co.Ltd(603786) , Fuyao Glass Industry Group Co.Ltd(600660) , Great Wall Motor Company Limited(601633) , Geely motor. At the current time point, the business situation of the enterprise in the first quarter is gradually clear. It is suggested to select the target with strong performance certainty in the main line.
Risk tip: the industry’s terminal sales are less than expected, the manufacturer’s R & D or new car release progress is less than expected, the upstream raw material supply is insufficient or the price rise leads to the decline of industry profits, etc.
