Key investment points:
Market review: as of April 29, 2022, the Shenwan automobile sector fell 1.71% in the week, 1.79 percentage points lower than the Shanghai and Shenzhen 300 index, and ranked 15th among the 31 industries of Shenwan. Among the five sub sectors of Shenwan automobile industry, passenger cars, motorcycles and other two sub sectors rose, while the other sub sectors fell. The specific performance is as follows: the passenger car sector rose 1.56%, the motorcycle and other sectors rose 0.02%, the auto parts sector fell 3.07%, the commercial vehicle sector fell 5.28%, and the auto service sector fell 6.95%. The top three companies with weekly growth were Wencan Group Co.Ltd(603348) , Zhejiang Cfmoto Power Co.Ltd(603129) , Mianyang Fulin Precision Co.Ltd(300432) , up 26.17%, 19.46% and 16.78% respectively. The top three companies with weekly declines were Zhejiang Changhua Auto Parts Co.Ltd(605018) , Shanghai Lianming Machinery Co.Ltd(603006) , Sichuan Haowu Electromechanical Co.Ltd(000757) , with declines of 26.85%, 24.03% and 22.05% respectively. In terms of valuation, as of April 29, the pettm of Shenwan automobile sector was 25 times, at the quantile of 65.10% in recent five years and 77.54% in recent ten years; In terms of sub sectors, the pettm of automobile service sector is 18 times, that of auto parts sector is 23 times, that of passenger car sector is 27 times, and that of commercial vehicle sector is 20 times.
View of Auto Industry Week: this week, the auto sector continued to decline, underperforming Shanghai and Shenzhen 300, and the performance is in the middle among the Shenwan level industries. According to the data released by China Automobile Circulation Association, the inventory early warning index of Chinese automobile dealers in April was 66.4%, up 10 percentage points year-on-year and 2.8 percentage points month on month. The inventory early warning index is above the boom and bust line, and the automobile circulation industry is in the recession range. Epidemic factors still had a negative impact on the automobile production and sales data in April. Since the middle and late April, the automobile industry chain in Shanghai, Jilin and other places has gradually resumed work and production. At the same time, recently, Guangdong, Shenyang and other places have introduced subsidy measures to promote automobile consumption. As one of the key supporting industries for the country to achieve the expected goal of stable growth, with the stability of epidemic prevention and control, the industrial chain will be reactivated, the production and sales will be replenished after the epidemic, and the probability of subsequent automobile production and sales will be marginally improved, driving the demand for parts and components to rise. After the impact of the epidemic, the valuation of the sector fell back to the historical center. It is suggested to pay attention to high-quality parts suppliers who actively grasp the development opportunities of automobile electrification and intelligence: Ningbo Tuopu Group Co.Ltd(601689) ( Ningbo Tuopu Group Co.Ltd(601689) ), Huizhou Desay Sv Automotive Co.Ltd(002920) ( Huizhou Desay Sv Automotive Co.Ltd(002920) ), Foryou Corporation(002906) ( Foryou Corporation(002906) ), Bethel Automotive Safety Systems Co.Ltd(603596) ( Bethel Automotive Safety Systems Co.Ltd(603596) ), Wencan Group Co.Ltd(603348) ( Wencan Group Co.Ltd(603348) ).
Risk tip: the risk of automobile production and sales falling short of expectations, the risk of sharp rise in raw material prices, and the risk of impact of the conflict between Russia and Ukraine on the global automobile industry chain.
