SAIC'S Departure From The "Big Brother In Market Value" Of The Whole Vehicle?

Small and medium-sized shareholders of SAIC can't sit still again.

Recently, on the investor interaction platform, a shareholder asked the Secretary of SAIC: "does anyone in your company maintain investor relations? Have you done investor reception? Is there any promotion of company value? " The most direct pain point is the last sentence: "is SAIC worth only 0.7 BYD?"

As the largest automobile group in China, SAIC has always been the vehicle enterprise with the highest market value of a shares. This year, however, things have changed. As early as July 7, BYD's share price soared to 83 yuan, and its market value soared to 226.44 billion yuan. On the same day, SAIC Group's share price fell slightly to 224.32 billion yuan, giving up the position of "first brother".

At that time, the market value gap between the two was not big, and the competition between the two sides was also slightly sticky. However, in the next three months, BYD's share price surged all the way, while SAIC was not warm and tepid. Finally, the situation that "SAIC Group is only worth 0.7 BYD" was formed. As of October 19, the market value of SAIC Group was 239.39 billion yuan, while that of BYD was 349.42 billion yuan. The market value of the former was only 0.68 times that of the latter.

Not only that, recently, SAIC has been overtaken by another younger car making force. In the same period, the market value of Weidong Automobile Group rose by 23.8 billion yuan (about 23.8 billion yuan) in the same period, and the market value of Weidong Automobile Group rose by 23.8 billion yuan in the same period.

As a matter of fact, with the market expectation of new energy vehicles getting stronger, many new automobile making forces are being sought after in the capital market. Although there is still a huge gap between them and traditional automobile enterprises in terms of sales volume, their valuation is far away from the latter.

According to the statistics of 21st century economic report, BYD, Weilai, SAIC Group and great wall motor are the four largest vehicle enterprises with the highest market value in China (about 349.4 billion yuan, 240.5 billion yuan, 239.4 billion yuan and 210.3 billion yuan respectively), followed by Geely Automobile, ideal automobile and Xiaopeng automobile (about 136.8 billion yuan, 110.8 billion yuan and 105 billion yuan respectively), and GAC The group took the second place (about 102.6 billion yuan).

Traditional automobile companies are forced to get involved in a new track in the wave of automobile industry reform, and they have to face a new evaluation system in the capital market. SAIC's stock market performance is only a miniature of this trend. But in the wave of "new four modernizations", the traditional automobile enterprises represented by SAIC are sparing no effort to transform. Why can't they get the favor of the capital market?

An ironic detail is that Hongguang Mini EV, a model of SAIC General Motors Wuling, broke away from the hot Tesla Model in the sales ranking of new energy vehicles in September 3 and won the championship, but such a big benefit has not been reflected in the stock price of SAIC. On the contrary, Wuling Motor Co., Ltd., a Hong Kong stock with little relevance, has soared by 42% -- under the new energy vehicle boom, can traditional automobile companies really not rise at all?

BYD and the new forces of car building

BYD and three new forces of car making listed in the US stock market once touted the whole vehicle enterprise, an industry plate which is not warm all the year round, into the "hot fried chicken" in the secondary market this year.

From the beginning of the year to the present, BYD's share price has risen from less than 50 yuan to 128 yuan, up 169%. From the lowest point to the highest point, the increase is as high as 173%; Weilai automobile is even more crazy, with its share price rising from $4 at the beginning of the year to $28.5, more than six times, making the media directly call "the worst person in 2019 has completely turned over!"

Weilai's year of 2019 is gloomy. It has experienced a series of negative moments, such as the shortage of funds, the fire of batteries, and the resignation of senior executives. Even it was revealed that it was going to go bankrupt, and its share price fell to the $1 mark. At that time, Li bin, chairman and CEO of Weilai automobile, was described as "the worst person in 2019". This year, with the confirmation of Weilai's follow-up financing matters and the steady improvement of sales volume, the capital market has reassessed the value of this new car making force.

In addition, ideal automobile and Xiaopeng automobile, which have just been listed in the US stock market this year, have also been recognized by the capital market. Compared with the issuance price, the shares of the two companies have increased by 45% and 72% respectively in a short period of one or two months.

The rapid rise of stock price makes the market value of these new forces of car making quickly surpass that of many traditional Chinese automobile enterprises. Idealist and Xiaopeng surpass GAC group and approach Geely Automobile. After a wave of big rise, Weilai surpasses the A-share giant SAIC Group and becomes the second largest Chinese automobile enterprise after BYD.

As a matter of fact, the valuation of new auto manufacturing forces before listing exceeded that of some relatively small-sized auto companies. The pre IPO valuations of Weilai, idealized and Xiaopeng were all around us $10 billion, which exceeded the shares of Dongfeng Group listed on the Hong Kong stock exchange.

However, Dongfeng Group is not the largest group in China. When Weilai surpassed SAIC, the market of Chinese automobile enterprises in the capital market has changed qualitatively to some extent

On the one hand, there are only three models of mass production delivery, annual sales of only tens of thousands of start-up enterprises, financial losses continue to continue, the other side is a number of large-scale car companies, the annual sales of millions of vehicles, over the years and will continue to make profits. In the eyes of active capital, the latter is not as attractive as the former.

Automobile industry track has changed?

No matter BYD or Weilai, the new automobile manufacturing forces represented by Weilai, are highly sought after in the capital market this year, which is related to the better prospects of the new energy automobile industry.

In the past few months, both domestic and overseas new energy vehicle markets have gradually recovered under the influence of the new crown epidemic. At the same time, with the favorable policies of governments in new energy vehicles, the prospect of new energy vehicles is optimistic.

According to the data, since the second half of this year, the domestic sales of new energy vehicles have entered a steady development channel. In September, the sales volume of new energy vehicles increased by 67.7% year-on-year to 138000 vehicles. Meanwhile, good news came from the European market. After the sales scale of new energy vehicles in the first half of this year surpassed that of China, the sales volume of new energy vehicles also increased by 195% in September. It is expected that the annual sales volume will exceed 1.1 million.

Once you enter the channel to restore growth, the enthusiasm for funds will be rekindled. Take BYD as an example, in fact, its sales volume and performance in the first half of the year are not optimistic (the cumulative sales volume in the first half of the year was 158600 units, a year-on-year decrease of 30.45%, among which, the cumulative sales volume of new energy vehicles was 60700, a year-on-year decrease of 58.34%). However, since the third quarter, with the market recovery and the introduction of new products, BYD's sales volume has rebounded, and its share price is also showing a phase at this stage For stable growth.

The industrial prospect is on the one hand, and the logical verification on the other. Many people in Tesla's auto industry even said that the rise of China's auto industry's stock price has a significant relationship with the rise of China's auto industry. "Tesla has led to market recognition of the segment of electric vehicles, especially smart vehicles." Some people from the industrial investment circle in Shanghai said.

This year, Tesla, the pioneer of electric vehicles, has also ushered in countless highlights. With the Shanghai plant put into operation and sales increased (especially in the context of the epidemic situation, the doubts faced by Tesla in the past seemed to be knocked back, and the share price and market value were also rising. In the end, Tesla even split its original shares, which made its share price look less frightening. Data show that Tesla's share price and market value have risen more than four times this year.

It is worth mentioning that the rising market value of the new auto making forces is more like the existence of "China Tesla" (although many radical bulls still think that Tesla is an energy enterprise, while weilairen is only a new type of automobile enterprise), while BYD is slightly different. "Weilai, ideality and Xiaopeng are in a trench, and 70% of BYD is the same as them." On October 19, Cao he, President of quanlian auto Investment Management Co., Ltd., told reporters, "BYD has other businesses."

Indeed, in addition to the automobile and related products business, BYD also has a considerable scale of mobile phone parts and assembly business, rechargeable battery and photovoltaic business. Take the data in the first half of this year as an example, these accounted for 46% of the total revenue. In addition to new energy vehicles, BYD also has many popular concepts such as lithium batteries, chips and even masks. The previous stock price rise was due to BYD's re-entry into Apple's supply chain.

Aggrieved "SAIC"

While the prospect of new energy vehicles and intelligent automobile industry is recognized, traditional automobile enterprises such as SAIC Group have not significantly improved their valuation.

Although SAIC and Geely are also the industry leaders benefiting from the new energy automobile industry chain in the Research Report of the seller analysts, these traditional automobile enterprises have not been more widely "recognized". Among them, Geely Automobile is relatively good, its share price has risen slightly by 8% since the beginning of the year, while SAIC and GAC have not risen, but both have shrunk by 14%.

However, SAIC has some grievances. The performance of these new energy companies is not inferior to that of the traditional automobile industry. For example, SAIC sold more than 80000 new energy vehicles in 2019, with a market share of 13.3%, second only to BYD. In terms of intelligent Internet connection, SAIC is actually the first enterprise among domestic automobile enterprises to lay out "Internet vehicles", and the Roewe rx5 jointly launched by it and Alibaba is also very popular for a time.

SAIC has long regarded electrification, intelligent networking, sharing and internationalization as its strategic layout. In terms of forward-looking technology accumulation, SAIC has rarely invested in three technical routes: pure electric, plug-in hybrid and fuel cell. According to the plan, SAIC will launch nearly 100 new energy products by 2025, doubling the number of new energy models of SAIC by 2025.

When the wave of new energy vehicles comes, SAIC, as a vehicle group, is expected to bring its multi brand advantages into full play. While increasing the investment of new energy vehicles by its own brands, SAIC Volkswagen, a joint venture of SAIC, is about to launch its pure electric vehicles based on MEB platform this year. Another joint venture, SAIC General Motors, plans to increase the proportion of new energy products to more than 40% in the next five years. Recently, there is also news that SAIC will build a high-end new energy brand that is benchmarked with Tesla, operate independently, and try to realize the brand leap.

However, these good news did not stir up obvious "waves" in the capital market, and SAIC only rose a little symbolically when the new energy vehicle plate soared.

On the one hand, SAIC Group's base is too large. On the other hand, SAIC Group, like other traditional foreign car companies, is lagging behind in the brand-new evaluation system of automobile industry brought by Tesla. "From the perspective of capital market, Tesla is not an automobile company, but a high-tech company. It has always positioned itself as a company with high-tech, Internet nature and software characteristics. This is also the direction of the transformation of the automobile industry, and Tesla has taken the lead." Chen Hong, chairman of SAIC Group, mentioned this topic at the general meeting of shareholders and pointed out that it is almost impossible for an automobile group of the size of Toyota and SAIC to transform into a technology company as a whole.

Cao he told reporters of the 21st century economic report that "the laws of capital market and industry are not quite the same. As long as the drum can be passed on, the capital can keep up with it." He pointed out that the price earnings ratio is people's imagination of the company's bright future, and the fundamentals are only one of the factors. For investors, the P / E ratio is not too high or too low, "anyway, don't hit me in the end."

For traditional automobile enterprises, if they want to seek re valuation, on the one hand, they need to be listed again, such as Geely and Dongfeng, on the other hand, they should split up their subsidiaries with advanced technology to fly alone. For example, SAIC executives have stated that they want to promote their innovative companies to be listed independently with the help of science and technology innovation board Dongfeng.

?