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Looking back at the past 2021, the automobile and its upstream and downstream industry chain are undoubtedly one of the most dazzling stars in the capital market.
As far as the A-share market is concerned, Q1 2021 is affected by the insufficient supply of automotive chips, the supply side of the industry is greatly affected, the superimposed market risk appetite is downward, and the auto sector has suffered a sharp correction; Q2 has restarted with the improvement of chip supply; into Q3, the outbreak of the epidemic in Malaysia has led to the suspension of production of chip factories, while the sharp rise in upstream raw material prices has caused disturbances to the cost of car companies, and some investors have begun to actively avoid the auto sector based on pessimistic expectations for the three quarterly reports However, with the resumption of work and production of Malaysian chip suppliers, the supply of Q4 chips has improved month-on-month, and the automotive sector as a whole has maintained a volatile upward trend.
Throughout the year, the annual increase of the automobile sector was close to 30%, significantly outperforming the three major A-share indexes. Zhitong Finance APP believes that the automobile sector can continue to outperform the market in 2021, and the deep-seated logic behind it is that it is currently in the era of the rise of the head independent brand and the new domestic forces, the independent brand and the joint venture brand stand on the same running line, and the independent brand has the ability to comprehensively surpass the joint venture brand in the new competitive environment.
Looking forward to 2022, Zhitong Finance APP judges that the independent rise will still be the main line of investment throughout the year, and the valuation of the head independent brand car companies will continue. Further, the penetration rate of new energy vehicles will continue to rise, and at the same time, intelligence may enter an accelerated period, and the competitive pattern of car companies will become more and more clear.
In terms of individual stocks, Zhitong Finance APP believes that the head Chinese automobile brands that add hybrid, pure electricity, intelligence and even hydrogen energy at the same time in technology are particularly worthy of attention. Taking the Great Wall Motor (02333, 601633.SH) of Changyang for three consecutive years as an example, the company has a global research, production and sales network, and has steadily expanded its production capacity in recent years, and has continuously broadened its circle of capabilities through mergers and acquisitions and incubation, and has been in a leading position in product electrification and intelligent transformation at this stage.
Standing at the new starting point of the current automotive industry pattern facing reshaping, Great Wall Motors did not stick to the old ideas, but instead devoted itself to the ecological industrial layout of new energy technology, new energy products, and intelligent tracks including automatic driving. If 2019 and 2020 are the market's revaluation of the value of Great Wall Motors, then since 2021, the company's performance has really increased, and the company's long-term investment value is expected to accelerate.
Lead the transformation of electric intelligence of Chinese automobile brands
From the perspective of the industry, we are currently at a historic moment in the transformation of automobiles to electrification and intelligence. On the one hand, the penetration rate of new energy vehicles in China will accelerate in 2021. The data shows that from January to November 2021, the penetration rate of new energy vehicles in China reached 12.73%, once again refreshing the historical high; in terms of single-month sales, the sales of new energy vehicles from January to September increased by more than 100% year-on-year.
On the other hand, the intelligence of automobiles is gradually approaching. According to the data of high-tech intelligent vehicles, in the first half of 2021, the loading rate of new intelligent cockpit cars in China reached 13.9%, an increase of 4.5% year-on-year. In terms of sub-projects, the vehicle networking, central control large screen, full LCD instrument, OTA, HUD carrying rates were 55%, 49.3%, 28.3%, and 5%, respectively, an increase of 7.6%, 19.2%, 7.3%, 4.6%, and 1% respectively over the whole of 2020.
At a time of change in the industry, how are the performance of self-owned brand cars? Or take Great Wall Motor as an example, as mentioned above, the company has a deep layout in the direction of electrification and intelligence.
In the direction of electrification, Great Wall Motors is one of the few enterprises among mainstream car companies that simultaneously lays out the three major technical routes of pure electricity, hybrid and hydrogen energy. Pure electric direction, taking the company's new brand salon's pioneering work Mecha Dragon as an example, the model was the first to use Dayu battery technology. On the basis of the heat source suppression, isolation and cooling technology in the traditional battery design concept, Dayu Battery solves the problem of fire and explosion after thermal runaway by means of air and fire flow channeling, and provides a new solution for solving the thermal runaway problem of high-nickel batteries with high energy density.
In the direction of hybridization, Great Wall Motor's lemon hybrid DHT has broken the situation that the Japanese company is the only one in the domestic hybrid market, with both power and economy, and excellent comprehensive performance. It is understood that at present, Haval and Weipai under Great Wall Motors have models equipped with lemon technology platforms. Next, all weipai products will continue to adhere to the hybrid core strategy, and the Haval H6 DHT version has performed well on the market, and has reached the top of the market segment for many consecutive months in the overseas Thai market.
In contrast, in terms of intelligence, Great Wall Motor's coffee intelligence integrates intelligent driving, intelligent cockpit and intelligent services, and this technology platform may become the key to its victory in intelligent competition. At present, Great Wall Motors' Coffee Smart 2.0 adopts a new electrical and electronic architecture, a smart wire-controlled chassis, a third-generation autonomous driving computing platform IDC 3.0, and the first intelligent cockpit GC-OS.
In addition, it is worth mentioning that the Great Wall Motor autonomous driving computing platform is equipped with a snapdragon ride solution, and the single board computing power of the platform can reach 360 tops, which can be continuously upgraded to 1440 tops, reaching the limited scenario L4 automatic driving capability, and its mass production models will be officially delivered in Q2 this year.
In summary, it can be seen that in the field of electrification and intelligence, which are more than the hard strength of car companies, Great Wall Motors has sufficient accumulation and its comprehensive strength is in a leading position. This can also be seen from the car sales data of Great Wall Motors.
According to the data, the cumulative sales of Great Wall Motors in 2021 reached 1.281 million units, an increase of 15.24% year-on-year, exceeding the expected annual sales target of 1.21 million units. It should be pointed out that this is the 6th consecutive year that the company has exceeded one million sales in a single year.
By brand, in 2021, the Annual Sales of the Haval Brand was 770,000 vehicles, an increase of 2.64% year-on-year; the annual sales of the Euler Brand were 135,000 vehicles, an increase of 140% year-on-year; the annual sales of Weipai were 58,363 vehicles, with the cumulative number of users exceeding 450,000; the annual sales of tanks 300 vehicles were 84,588 vehicles, and the current tank brand had a market share of more than 50% in China's off-road vehicle market; and pickup truck sales were 233,000 units, an increase of 3.56% year-on-year.
In the whole year of 2021, Great Wall Motor will have sold 137,000 new energy vehicles. It is worth mentioning that the company plans to achieve an annual sales target of 4 million vehicles in 2025, of which 80% will be new energy vehicles. Considering that the new products launched by Great Wall Motors based on the new platform have repeatedly become blockbuster models, it is expected that the company's new energy vehicles will accelerate in 2022.
By opening up overseas high-potential energy markets, we will break through the growth ceiling
In the past 2021, Great Wall Motors released the 2025 strategy, that is, "global layout, large investment in research and development, great change of enterprises, and large operation of users". Among them, Great Wall Motors places the global layout at the top of the four major strategies, which shows that globalization is the top priority of the company's future development.
From a market perspective, it is not surprising that Great Wall Motors is targeting overseas markets. Referring to the development path of Toyota Motor, in the oil crisis in the 1970s, Toyota successfully opened the North American market with economic and fuel-saving products, and officially opened the globalization journey. Since the 1980s, Toyota has launched an offensive into emerging markets, including China, and gradually developed into the world-class brand that is known today.
Looking back at Great Wall Motor, after decades of development, the company has grown into the head car company in China's auto brand. Whether from the perspective of capital, technology or brand, Great Wall Motors has the ability to develop towards globalization. Taking the overseas performance in 2021 as an example, the company's overseas sales for the whole year were 142,800 units, an increase of more than 100% year-on-year. Among them, Great Wall Motors in Australia, New Zealand, Russia, Saudi Arabia and other markets has jumped to the top camp.
It is understood that Great Wall Motors will continue to focus on overseas high-potential energy markets, strategically focus on Thailand and Russia, focus on core self-operated markets such as Australia and South Africa, and begin to lay out blank markets such as Europe, South America and Brazil.
Zhitong Finance APP believes that the overseas market space is vast, and the implementation of globalization has undoubtedly greatly increased the possibility of Great Wall Motors achieving its 2025 strategic goals. Taking the Thai market, which the company attaches great importance to, as an example, from a general point of view, Great Wall Motor's entry into Thailand has two major advantages:
First, in terms of external conditions, the thai market at the policy end has long been in a Japanese monopoly, lack of competition, slow model and technological upgrading, the Thai government is willing to introduce new competitors; on the industrial side, Thai cars are fully transforming into electrification, and follow-up supporting policies are expected to continue to increase; on the consumer side, the current trend of thai consumption is becoming more and more obvious, and the angle of the new generation of consumers choosing cars is quite different from that of the older generation of consumers.
Second, from its own point of view, Great Wall Motors' products fit the Thai market, whether from the perspective of electrification and intelligence of the product, or the brand's "tide" cultural elements, they are close to the car purchase preferences of the main consumer groups in Thailand. In addition, Great Wall Motors also has outstanding vertical integration capabilities, with four major parts companies in the system, and the self-control rate of auto parts is more than 60%, which also provides the underlying support for the company to establish a supply chain system overseas.
Zhitong Finance APP learned that the current forward production capacity of Great Wall Motor's Thailand plant is 200,000 vehicles / year, according to the calculation of analysts at Northeast Securities, it is conservatively estimated that the production capacity can be further increased to 250,000 vehicles / to 300,000 vehicles / year by increasing the frequency. It is foreseeable that as long as Great Wall Motors succeeds in Thailand, the company will inevitably replicate its successful experience to other ASEAN countries. Given that the total car sales volume in the ASEAN market is 3.5 million units per year, the region is expected to bring considerable performance increments to Great Wall Motors in the future.
Globally, as mentioned above, Great Wall Motors has established a global research, production and sales network, and its sales in key markets have shown rapid growth. In the future, as the company introduces more of its latest models into overseas markets, the company's sales in overseas markets are expected to continue to rise rapidly, which will provide important support for Great Wall Motors to achieve the 2025 strategy as scheduled.
The performance volume trend is expected to continue
Returning to the perspective of the capital market, in terms of the trend of core financial data changes, 2020 can be described as a major watershed in the performance of Great Wall Motors. In that year, after experiencing a slight decline in the previous two consecutive years, the company's revenue regained its upward momentum and broke through the 100 billion yuan mark in one fell swoop, reaching 103.308 billion yuan in the whole year; in terms of net profit, the company also reversed the decline of the previous year and achieved double-digit growth, reaching 5.362 billion yuan.
In the first three quarters of 2021, the company maintained its growth trend, with revenue reaching 90.797 billion yuan, an increase of 46.11% year-on-year; net profit of 4.945 billion yuan, an increase of 91.13% year-on-year. The rapid growth of Great Wall Motor's performance is not unrelated to the sales volume of its models, as mentioned earlier, the sales of the company's major brands in 2021 have a bright performance, of which the Euler brand has doubled year-on-year.
Looking forward to 2022, Zhitong Finance APP believes that relying on the three major technology brands of "lemon + tank + coffee intelligence", the company is expected to usher in a new round of strong product cycle this year. According to public information, Great Wall Motors has now determined that the models that will be listed within the year include: Euler brand, ballet cat will be listed in Q1, punk cat, lightning cat will be listed in Q2, when the company's product matrix in the field of pure electricity will be further enriched; Wei brand, Mocha DHT-PHEV and latte DHT-PHEV will be listed in Q1, and Dream Fulfillment will also be launched within the year.
A number of models with deep explosive potential have a listing schedule, which undoubtedly injects strong expectations into the performance of Great Wall Motors. Superimposed Wei brand a number of DHT models are listed in Q4 2021, is currently in the production capacity climbing period, 2022 is expected to become the company's DHT model outbreak of the first year. Under comprehensive consideration, the company's performance this year will continue the ultra-high-speed growth trend of the previous year.
Looking at the stock price performance, as mentioned above, The stock price of Great Wall Motors has closed the Yang line for 3 consecutive years. Looking back at the trend, Zhitong Finance APP believes that the company's stock price recovery in 2019 is a correction of the excessive killing of the stock price in the previous year, and the sharp rise that began in 2020 reflects the optimistic expectations of the capital market for the performance of Great Wall Motors to regain its upward trend.
Combined with the fundamentals, the real volume of Great Wall Motor's performance began in 2021, considering that the company will fully focus on the strategic layout of 2025, the speed of the company's new products will be maintained at a relatively fast level in the future, and the performance of the company's overseas markets is also expected to bring surprises. Under the catalysis of multiple factors, the company's stock price has a greater probability of coming out of the long bull trend.
With the gradual approach of electric intelligence, it is now the best time to rise independently and achieve overtaking of joint venture brands. It is safe to believe that in this historical tide, opportunities and challenges are equal for all players. Only in terms of current achievements, whether from the performance or market value performance dimension, Great Wall Motors ranks first in the camp of Chinese brands. Next, what Great Wall Motors needs to do is to maintain its advantages and continue to seek towards the strategic goal of 2025.
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