BYD'S Net Profit In 2020 Is 4.234 Billion Yuan: Further Consolidating The Leading Position Of New Energy Vehicles

By Zhang Lang

On March 29, BYD (002594. SZ) released its financial report for 2020. According to the financial report, in 2020, the company realized revenue of 156.598 billion yuan, and the net profit attributable to shareholders of listed companies was 4.234 billion yuan, with a year-on-year increase of 162.27%.

Since the second half of 2020, BYD's sales volume has continued to rise, and its income, profit and other indicators have increased month on month. Take Han, the flagship model of BYD, as an example. After its launch, it has been recognized by consumers and its sales volume has increased rapidly. Since it came into the market, it has sold more than ten thousand for several consecutive months, ranking among the top of the same level models.

It is worth noting that at the beginning of 2020, under the impact of the epidemic situation, BYD quickly responded to the call for rapid production of masks and other epidemic prevention materials. At the same time, its main business maintained a good development rhythm. In addition to the production and sales of new energy vehicles, significant progress has been made in 2020 in terms of power battery external supply business and semiconductor business split listing.

At present, the automobile industry is in the era of great changes, still full of various uncertainties. While dealing with various adverse factors brought about by the epidemic, BYD's leading edge in the field of new energy automobile industry chain has been further highlighted through the continuous expansion of opening up. BYD's performance forecast for the first quarter of 2021 shows that the net profit in the first quarter of 2021 is expected to be 200-300 million yuan, with a year-on-year increase of 77.57% - 166.36%.

BYD's future potential is favored by investors, and its share price has doubled in the past year. By the end of March 29, BYD had 168.10 yuan per share, with the latest market value of about 480.958 billion yuan.

Consolidate the leading position of new energy vehicles

With the effective control of the epidemic situation, China's new energy vehicle market began to recover in the second half of 2020. After entering the second half of the year, BYD's production and sales also continued to pick up, with the month on month increase. It is particularly noteworthy that the sales structure of BYD has changed. The market performance of high-end models represented by BYD Han EV is extremely bright. In November and December, BYD's sales continued to exceed 10000, which is considered to set a new benchmark for China's independent brands.

As a high-end model of BYD, BYD Han is equipped with blade battery. Since its appearance design, intelligent configuration and endurance advantages, BYD has attracted the attention of the industry. It is not only an important model for BYD to challenge Tesla, but also a key model for BYD electric vehicles to enter the market-oriented stage and compete directly with foreign brands.

In the past ten years, with the rapid development of electric vehicles in China, local enterprises have also made significant progress in the process of technology accumulation. BYD's success in the market confirms the advantages of BYD's electric vehicle technology over the years, and also shows BYD's technological innovation in the process of transformation towards "new four modernizations". At the same time, the brand promotion of BYD has also brought remarkable effect. Chinese brands are also more confident on the road to high-end.

In addition to pure electric field, BYD also took the lead in strategic subdivision of plug-in hybrid technology. In 2020, after dm-p super power technology defines the "absolute performance" of plug-in hybrid vehicles, BYD will further launch the DM-I super hybrid technology focusing on "ultra-low fuel consumption" from the perspective of consumer demand.

The Xiaoyun plug-in 1.5L high-efficiency engine specially built for DM-I super hybrid technology aims to achieve ultra-low fuel consumption. The thermal efficiency is as high as 43%, which is one of the highest thermal efficiency mass production gasoline engines in the world.

Compared with the traditional fuel vehicles, the DM-I super hybrid technology has lower fuel consumption, faster starting, smoother and quieter, more environmentally-friendly electric vehicles, and no restrictions on purchase and travel. However, the price of the model equipped with DM-I super hybrid technology is equivalent to the landing price of foreign fuel vehicles of the same level.

In March this year, Qin plus DM-I and song plus DM-I models equipped with BYD's latest DM-I super hybrid technology were officially launched.

Zhongtai Securities pointed out that BYD's three models based on the DM-I new platform have reduced the dimension and hit the fuel vehicle market, achieving parity with the same level of fuel vehicles in terms of price, and at the same time, it has the advantages of electric vehicle cost and other advantages, which will further accelerate the electrification of automobiles in China.

Blade battery redefines electric vehicle safety standard

In March 2020, BYD officially released the blade battery and released the video of the blade battery successfully passing the "needle test". Once released, it has attracted the attention of the industry.

"Blade batteries will change the industry's dependence on ternary batteries, return the technical route of power batteries to the right path, and redefine the safety standards for new energy vehicles." Wang Chuanfu, chairman of BYD, said.

The battle of power battery is rising again. Power battery is known as the "heart" of electric vehicle. As the core key component of electric vehicle, power battery determines the life, price, safety and other factors of a car, and the biggest characteristic of blade battery is safety.

BYD's success is inseparable from the help of blade battery for the improvement of endurance, quality and other aspects. The success of Han also makes BYD's electric vehicle market share further.

Moreover, the blade battery is also an important part of BYD's battery opening strategy. It is understood that many car companies are interested in carrying BYD's blade battery on the newly launched electric vehicles, including some well-known multinational automobile enterprises.

In March last year, BYD announced the establishment of five Fudi companies to further accelerate foreign cooperation in new energy core components. The five companies are Fudi Battery Co., Ltd., Fudi vision Co., Ltd., Fudi Technology Co., Ltd., Fudi Power Co., Ltd., and Fudi Mold Co., Ltd.

Among them, Fudi battery attracts the attention of the industry. As new energy vehicles are accepted by more and more consumers, the demand for power batteries will increase exponentially in the next few years.

BYD, which is the leader in battery technology, can not only fully empower its products, but also achieve higher scale efficiency by supplying batteries to other automobile enterprises, so as to reduce battery cost and promote the development of electric vehicle industry.

When the semiconductor business is split

With the development of automobile intelligence, the chip of vehicle gauge level is expected to become the next blue ocean. BYD is well aware that the "neck jamming" technology must be mastered in its own hands. Therefore, in the past few years, BYD has independently developed and independently controlled IGBT for vehicle specifications.

As the "CPU" of electric vehicles, the core technology of IGBT is the core business of BYD semiconductor, which has been dominated by foreign enterprises for a long time.

After more than ten years of R & D accumulation and large-scale application of new energy vehicles, BYD semiconductor has grown into China's leading IDM IGBT manufacturer, and created a precedent for domestic substitution of new energy vehicle IGBT, successfully breaking the monopoly of international giants in the field of vehicle specification level IGBT. At the same time, BYD is also the first semiconductor manufacturer in the world to apply SiC module to automobile main electronic control, which provides a solid backing for domestic independent control of electronic control core components of new energy vehicles.

BYD's semiconductor business is speeding up the process of financing, spin off and listing.

On April 14, 2020, BYD announced the restructuring of its wholly-owned subsidiary BYD semiconductor and plans to introduce strategic investors. One month later, on May 26, BYD semiconductor announced the introduction of a round of 1.9 billion financing, with participating institutions including Sequoia Capital, CICC capital and SDIC innovation leading investment. On the evening of June 15, BYD issued another announcement to introduce 30 new strategic investors including SK group, Xiaomi group and CMB international.

According to the pre investment valuation of BYD semiconductor, the two rounds of investors raised about 1.9 billion yuan and 800 million yuan respectively, with a total valuation of 10.2 billion yuan. Some people believe that after BYD semiconductor's successful listing in the future, the participation of industrial investors and other multi-attribute investment participants will bring more possibilities for the development of BYD semiconductor, and its valuation may increase exponentially.

The introduction of strategic investors by BYD semiconductor fully reflects the market value and development prospect of BYD group's semiconductor business after deep integration. It is another important progress in actively seeking an appropriate time for independent listing after its internal restructuring. The follow-up companies will continue to actively promote the listing of BYD semiconductor and start to cultivate more subsidiaries with market competitiveness Market oriented operation, continuously improve the overall value of the company.

Through the introduction of war capital, it will help to enhance BYD semiconductor's position in the industry, promote the diversification of BYD semiconductor's shareholder structure, improve the company's independence, improve the corporate governance structure, and make full use of the investment and strategic layout of well-known investment institutions in the semiconductor industry, automobile industry and consumer electronics industry, so as to help BYD semiconductor realize the upstream and downstream expansion and enrichment of the industrial chain Third party customer resources.

At the same time, it is also conducive to BYD semiconductor to strengthen its industry research ability, grasp the industry research and development direction, accurately grasp the latest development opportunities of the industry, expand its capital strength, realize capacity expansion, accelerate business development, and comprehensively strengthen its talent competitive advantage and product R & D ability.

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