\u3000\u3 China Vanke Co.Ltd(000002) 594 Byd Company Limited(002594) )
Event overview
On April 18, the company released the performance forecast of 2022q1. The net profit attributable to the parent company in 2022q1 was 650950 million yuan, a year-on-year increase of + 174.0% – 300.0%; EPS is 0.22-0.33 yuan / share, compared with 0.08 yuan / share in the same period last year.
Analysis and judgment:
The performance increased against the trend, and the whole vehicle performed brilliantly
The company’s 2022q1 performance is brilliant, showing resilience against the trend. In 2022q1, the net profit attributable to the parent company was 650950 million yuan, with a year-on-year increase of + 174.0% – 300.0% and a month on month increase of + 8.0% – 57.8%. Bulk 2022q1 continued to rise, and the average price of main raw materials aluminum and copper 2022q1 were + 36.6% and + 14.2% year-on-year respectively, and + 10.8% and + 0.9% month on month respectively. In terms of single vehicle subsidy, the maximum reduction of pure electric / plug-in hybrid is about 5000 yuan and 2000 yuan respectively compared with 2021. The company overcame the sharp rise of raw materials and the decline of subsidies, and the net profit increased against the trend.
The electronic business dragged down, and the profit of the whole vehicle took off gradually. Deducting Byd Company Limited(002594) electronics, the net profit attributable to the parent company of automobile in 2022q1 is 570820 million yuan (the loss in 2021q1 is 290 million yuan), and the corresponding net profit of single vehicle is 202900 yuan (the profit in 2021q1 is – 5000 yuan), which increases rapidly.
The scale effect significantly hedges the price rise of raw materials, and the profit elasticity is obvious. The company’s sales volume continued to increase. In 2022q1, the cumulative sales volume of new energy passenger vehicles reached 284000, with a year-on-year increase of + 433.4% and a month on month increase of + 8.3%. The sales of the main models Qin plus DM-I and song plus DM-I were 47000 and 58000 respectively, with a year-on-year increase of + 1485% and + 3985% respectively; The sales of high value models Tang DM-I and Han were 28000 and 34000 respectively, with a year-on-year increase of + 657.3% and + 25.4% respectively. We judge the rapid growth of sales volume and significantly reduce the depreciation and amortization of single vehicle, so as to effectively hedge the pressure of rising costs.
The advantages of vertical integration appear, and the profit elasticity is accelerated
The company’s vertically integrated supply chain has accelerated its advantages in the industry disturbance. Under the background of core shortage and epidemic situation, the company’s monthly sales reached a new high, highlighting the advantages of the company’s vertically integrated supply chain in the disturbance of the industry. In March, the company’s monthly sales exceeded 100000 vehicles for the first time, a year-on-year increase of + 156.9%, significantly exceeding the overall level of the industry. The company’s core parts are highly self-made. It is expected that under the supply disturbance factors of the industry, the production and sales of the company are expected to grow against the trend, and the monthly sales are expected to continue to climb.
The price adjustment lags behind by about a quarter, and the release of profit elasticity is expected to accelerate. Against the background of the sharp rise in battery costs, the company carried out two price adjustments in January and March respectively, with a total price adjustment range of about 4.7% – 6.7%. It is estimated that the overall delivery period of the company is about 2-3 months. We expect that the increment brought by the two price adjustments of the company is expected to be reflected in 2022q2, and the profit elasticity will be accelerated.
Comprehensive transformation of new energy technologies to define users
The company announced the suspension of the sale of fuel vehicles and the comprehensive transformation of new energy. Since March, the company has stopped selling the whole vehicle production of fuel vehicles. In the future, the automobile sector will focus on the business of pure electric and plug-in hybrid vehicles, and will continue to ensure the after-sales service of existing fuel vehicles. We believe that the comprehensive transformation of new energy is the only way to deep decarbonization. The company stopped selling fuel vehicles in an all-round way faster than we expected and ahead of the vast majority of vehicle enterprises, demonstrating the company’s confidence and confidence in new energy products.
The introduction of vehicle models accelerates the realization, from defining technology to defining users. Unlike most companies that start by relying on user positioning (SUV), the company gives priority to breaking through platform technology. Based on this, the strategy of building fist products has a strong late mover advantage in product positioning: 1 China Vanke Co.Ltd(000002) 00000 yuan interval Dynasty + ocean dual network support, which is expected to accelerate the replacement of fuel vehicles; Only 10 hours after the pre-sale of Han DM-I and dm-p was opened, the order has exceeded 12000 vehicles. We expect that the new Han DM-I and dm-p are expected to increase the monthly sales center of Han family by 10000 vehicles; Frigate 07 is expected to fill the company’s vacancy in the medium-sized SUV pedigree. With the continuous output of the models of the two platforms, the company’s platform capability will quickly enter the harvest period from the verification period.
Investment advice
The company relies on DM-I and E3 0 two advanced technology platforms, the iteration speed of models and the probability of popular models have been significantly improved, and the inflection point of new production capacity and new models is imminent. At the same time, the company’s supply chain security capability has repeatedly been tested by industrial force majeure and successfully demonstrated strong stability, which can better cope with the inflection point of sales growth and scale effect driven performance with the continuous listing and rapid volume of new models. Keep the profit forecast unchanged. It is estimated that the company’s revenue from 2022 to 2024 will be 3147.4/3774.5/428.34 billion yuan, the corresponding net profit attributable to the parent company will be 74.6/132.6/17.93 billion yuan, the corresponding EPS will be 2.56/4.56/6.16 yuan, the corresponding closing price of 239.10 yuan / share on April 18, 2022, and the PE will be 93 / 52 / 39 times respectively, maintaining the “overweight” rating.
Risk tips
Capacity expansion is lower than expected; Downside risk of auto market; Sales of new models fell short of expectations.
