\u3000\u3 Shengda Resources Co.Ltd(000603) 129 Zhejiang Cfmoto Power Co.Ltd(603129) )
Key investment points
In March, 250cc + two wheeled vehicles in the industry increased by + 31% year-on-year, and the company's 250cc + two wheeled vehicles increased by 168% year-on-year. According to the data of China Motorcycle chamber of Commerce, the sales of high displacement two wheeled vehicles in the industry in mid March were 138000, a year-on-year decrease of 14.5%, including 3 Hangzhou Huaxing Chuangye Communication Technology Co.Ltd(300025) 0cc + two wheeled vehicles, a year-on-year increase of 31%. In March, the company sold more than 5700250cc two wheeled vehicles, with a year-on-year increase of 47%; The sales of 250cc + two wheeled vehicles exceeded 5500, with a year-on-year increase of 168%, the market share of 16.7%, and a year-on-year increase of 8.5pct.
This year, the company has launched a vintage model 250-clx and a new single rocker 250sr-r. The imitation racing 450sr has also begun to enter the pre-sale stage, and the market response is strong. We expect that with the opening of the new cycle of 250cc and 400cc displacement, the sales volume will rise significantly in the near future.
The sales network of two wheeled vehicles / four wheeled vehicles has been continuously improved, and the sales volume has been continuously improved with the help of the international distribution network
Chinese market: in 2021, 164 new dealers were added, with a total of more than 650 dealers (more than 600 "CFMOTO" distribution outlets and more than 40 "ktmr2r" distribution outlets), so as to achieve 100% coverage of the provincial capital, 92% coverage of prefecture level cities, and gradually cover the first and second tier markets to the third and fourth tier markets, with continuous improvement of the sales network.
International market: the company added 150 retail outlets in 2021. At present, it has more than 3000 distribution outlets in the international market. Benefiting from the construction of international sales channel network, the market share of the United States continues to increase, the market share of Europe continues to rank first, and the export volume of all terrain vehicles ranks first in the export volume of national product brands.
In March, the company's export of two wheeled vehicles increased by 210% year-on-year, which will become a new engine for the growth of the whole year
Export of two wheeled vehicles: the company exported more than 5100 two wheeled vehicles in March, with a year-on-year increase of 210%. Among them, the export of 250cc + large displacement two wheeled vehicles exceeded 4300, with a year-on-year increase of 260%. The competitiveness of overseas markets has gradually become prominent. From January to March 2022, the total export of two wheeled vehicles exceeded 13000, with a year-on-year increase of 200%. We expect that in 2022, the company's export of two wheeled vehicles is expected to exceed 50000 units, of which the export of 250ml + large displacement two wheeled vehicles is expected to exceed 40000 units, becoming a new engine for annual growth.
Four wheeled vehicles: in March, 42000 domestic four wheeled vehicles were sold, with a year-on-year increase of + 6.5%. Among them, the company sold more than 15000 four-wheel vehicles, a year-on-year increase of + 26%. From January to March 2022, the cumulative sales of four-wheel vehicles exceeded 38000, with a year-on-year increase of 22%, maintaining a high growth trend. The company's overseas four-wheel vehicle sales are still in short supply. It is expected that the market share in Europe and North America will further increase this year, and the annual four-wheel vehicle sales are expected to exceed 200000 units.
Profit forecast and Valuation: the net profit CAGR in the next three years is 50%, maintaining the "buy" rating
It is estimated that the net profit attributable to the parent company from 2022 to 2024 will be RMB 680 / 10.5 / 1.4 billion, with a year-on-year increase of 66% / 54% / 33% and PE of 21 / 13 / 10 times. The net profit CAGR from 2022 to 2024 is 50%. Based on the gradual increase in the market share of four-wheel vehicles and two wheel vehicles, the company has a deep understanding of consumers and is good at building popular models, and maintains the buy rating.
Risk warning: overseas development fails to meet expectations; Intensified competition in China; Raw materials, sea freight and exchange rate fluctuation risk
