\u3000\u3 Guangdong Shaoneng Group Co.Ltd(000601) 633 Great Wall Motor Company Limited(601633) )
Event:
Great Wall Motor Company Limited(601633) released the annual report for 2021: during the reporting period, the company realized an operating revenue of 136405 billion yuan, a year-on-year increase of + 32.04%; The net profit attributable to shareholders of listed companies was 6.726 billion yuan, a year-on-year increase of + 25.43%; The net profit attributable to the shareholders of the listed company after deducting non profits was 4.203 billion yuan, a year-on-year increase of + 9.55%.
Key investment points:
Q4 performance in 2021 is under short-term pressure. In Q4 of 2021, the company achieved an operating revenue of 45.607 billion yuan, a year-on-year increase of + 10.79% and a month on month increase of + 57.98%; The net profit attributable to the parent company was 1.781 billion yuan, with a year-on-year increase of – 35.82% and a month on month increase of + 25.76%; The gross profit margin was 15.30%, with a year-on-year ratio of -2.96 PCT and a month on month ratio of -2 PCT. We believe that the decline of Q4 profit is mainly due to the discount of Euler HaoMao 10000 yuan charging equity and the increase of equity incentive expenses. From the perspective of the whole year, the gross profit margin was 16.16%, with a year-on-year increase of -1.05pct, mainly due to the recording of transportation expenses into costs in accordance with regulatory regulations in the reporting period.
Equity incentives strengthen talent development management. In 2021, the company’s management expense ratio was 2.96%, with a year-on-year increase of + 0.49pct, mainly due to the increase in the number of managers and the increase in equity incentive expenses during the reporting period. The company implemented two equity incentive plans in 2020 and 2021 respectively, with a total of more than 10000 granted objects, covering 50% of the core employees. In the future, Great Wall Motor Company Limited(601633) will also implement a rolling equity incentive model with wide coverage, which will cover 100% of value employees and realize the common development of enterprises and talents.
Product structure optimization helps improve profitability, and technological innovation accelerates the transformation of intelligent electric vehicles. The company has formed six major brands: haver, WeiPai, Euler, tank, Great Wall pickup truck and salon. In 2022, it is expected that new models such as haver cool dog, WeiPai dream fulfillment, tank 700, diamond gun, salon machine dragon and Euler lightning cat will be listed, with high-end development of products, optimization of the company’s product structure and promotion of profitability. In addition, the company’s R & D investment has increased year by year in recent years. The R & D expense rate in 2021 was 3.29%, with a year-on-year increase of + 0.32pct. At present, the company maintains industry-leading technical strength in the fields of powertrain, hydrogen energy and intellectualization, and has created three technology brands of “lemon”, “tank” and “coffee intelligence”. The company is accelerating the transformation to intelligent electric, and the competitiveness of new energy products is improving. In 2021, the company’s ASP exceeded 106000 yuan, a year-on-year increase of + 15.02%. From January to February this year, the proportion of sales of models above Great Wall Motor Company Limited(601633) 150000 yuan increased to 15.5%, and the proportion of intelligent models increased to 88.1%.
Profit forecast and investment rating as the leader of China’s independent automobile brands, the company has formed six brand matrices, continuously enriched its products, continuously optimized its product structure, and promoted the improvement of profitability; Euler and Sharon made efforts to accelerate the transformation of intelligent electric. We are optimistic about the future development of the company. It is estimated that the company will achieve operating revenue of 190.5 billion yuan, 247.9 billion yuan and 302.1 billion yuan from 2022 to 2024, with a year-on-year growth rate of 40%, 30% and 22%; The net profit attributable to the parent company was RMB 8.48 billion and RMB 12461711 billion, with a year-on-year growth rate of 26%, 47% and 37%; EPS is 0.94, 1.35 and 1.85 yuan. The current share price corresponds to PE of 29, 20 and 15. The valuation is reasonable and maintains the “overweight” rating.
The risk indicates that the recovery of the epidemic situation is lower than expected; The price of raw materials and freight continue to rise; The demand growth of new energy vehicles is lower than expected; Subsidies for terminal price increases; The development progress of automobile intelligence is less than expected; The high-end process of independent brands is blocked; The replacement progress of domestic parts is less than expected.
