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Tesla in an electric scooter, NIU.US, walked to the crossroads.
According to the Zhitong Finance APP, Maverick Electric recently announced the fourth quarter and annual financial results of 2021. According to the financial report, the company's revenue in 2021 was 3.705 billion yuan (RMB, the same below), compared with 2.444 billion yuan in the same period last year, an increase of 51.6% year-on-year. Net profit for the full year was RMB226 million, compared to RMB169 million in the same period last year, an increase of 33.7% year-on-year. Net profit per ADS after dilution was $2.81, compared to $2.14 in the year-ago quarter.
In terms of sales, the total sales volume of calf products in 2021 was 1.0379 million units, an increase of 72.5% year-on-year. Sales in the Chinese market and the international market reached 988,000 units and 49,900 units, respectively.
However, the "three growths" of Maverick Electric sales, revenue and profit cannot be exchanged for the "bottoming out" of the stock price. The company's share price has fallen to $8.35 from a high of $53.38 in February 2021. It is quite a meaning to see him rise up a tall building and feast on guests, and to see his building collapse.
The heart is "sinking", and the profitability of bicycles is declining
The reason why investors chose to sell Maverick Electric stock is not difficult to explain. Zhitong Finance APP noted that since the second half of 2021, the profitability of Maverick Electric has shown a significant inflection point. The company's Q3 2021 revenue was 1.226 billion yuan, an increase of 37.1% year-on-year; Net profit was 91.7124 million yuan, an increase of only 14.6% year-on-year. By Q4 2021, the company's revenue was 986 million yuan, an increase of 46.7% year-on-year, but the Q4 net profit was only 47.6467 million yuan, down 18.1% year-on-year.
In fact, Maverick Electric's increase in revenue and profit in the second half of 2021 is not a slowdown in the company's sales growth. According to the financial report, taking Q4 2021 as an example, the company's sales of electric motorcycles, electric mopeds, electric scooters and electric bicycles were 238,200 units, an increase of 58.3% year-on-year. Among them, sales in the Chinese market reached 20,500 units, an increase of 49.2% year-on-year. Sales in the international market were 32,900 units, up 155.8% year-on-year.
According to the division of business, the company's electric scooter Sales in the Chinese market in Q4 2021 was 683 million yuan, an increase of 47.9% year-on-year; The international market revenue of electric scooters was 189 million yuan, an increase of 63.8% year-on-year; Sales and service revenue of accessories and spare parts was 114 million yuan, an increase of 20.4% year-on-year.
One of the main reasons for the slowdown in the growth rate of Maverick Electric profits is the decline in the company's electric scooter bicycles. In Q4 2021, the company's bicycle revenue was 4140 yuan, down 7.3% year-on-year. Among them, the revenue per electric scooter in the Chinese market was 3326 yuan, down 0.9% year-on-year; The revenue per electric scooter in the international market was 5749 yuan, down 36% year-on-year.
The decline in revenue of Maverick electric bicycles can start from the company's launch of the non-intelligent positioning of the Gova series in 2020. In May 2020, the G0 model launched by Mavericks once became a hit at a discounted price of 1999 yuan. Subsequently, the Gova series successively launched F0 and C0, two models positioned in the middle and low end. Among them, C0, launched in July 2021, is designed for female users and is priced at 3399 yuan. Low-cost models have occupied an important position in the maverick electric product structure in 2021, of which the sales of G0 and F0 in Q1 of 2021 accounted for 38.2% and the proportion of Q2 reached 30.4%. In addition, the company's launch of the K series of scooters priced at 3299 yuan in overseas markets has also reduced the average price of products to a certain extent.
In the eyes of the outside world, Maverick Electric is the Tesla of the electric two-wheeler market, but in Maverick's own concept, high-end models may only be the entrance of the company to the sea of electric two-wheelers, and what the company really wants to do is the Honda of the electric two-wheeler market. If you want to become a "Honda", it makes sense to launch low-priced models to sound the clarion call to enter the sinking market.
The "new national standard" dividend has dissipated, why should the mavericks grow?
In the view of zhitong financial APP, the "sinking" journey of the maverick is "famous".
In April 2019, the official landing of the "new national standard" further reshaped the competitive landscape of China's electric two-wheeler market. As the new national standard "clearly stipulates the core configuration indicators such as speed, motor, and vehicle weight, it further raises the threshold for entry into the industry, accelerates the clearance of low-end production capacity, and concentrates market share on the head car companies."
According to CITIC Securities Research Report, between 2016 and 2020, the CR4 of China's electric two-wheeler industry has increased from 29% to 69%, and it is expected that CR2/CR4 will reach 51%/76% in 2021.
From the perspective of sales growth, Maverick Electric is the beneficiary of the "new national standard", but from the perspective of changes in the market competition pattern, the real "winner" is still the head enterprise represented by Yadi and Emma. The share of head companies continues to increase, and rising stars such as Maverick Electric are facing the problem of who to grow.
Although entering the overseas market is a must, considering that the domestic and foreign sales ratio of Maverick Electric is 20:1, the company's layout in overseas markets still has a long way to go. In contrast, in the domestic electric two-wheeler market, with the massive demand for replacement and natural growth brought about by the landing of the "new national standard", the sales of electric two-wheelers in 2020 reached 47.6 million units, an increase of 29% year-on-year. The domestic market is undoubtedly the best electric two-wheeler market in the world, and it is also a market worthy of the priority layout of Maverick Electric.
However, the layout of the domestic market with the main high-end products of The Maverick electric layout is facing a "dilemma", one is that the "new national standard" dividend is gradually fading and the market growth is expected to be peaceful. According to Cinda Securities, the growth rate of China's electric two-wheeler market will decline to single digits in 2024 and remain in the long run. In addition, the penetration rate of high-end two-wheeled electric vehicles marked by intelligence is only 0.8% in 2020, and it is expected to break through to double digits in 2025. This shows that if Maverick Electric adheres to the high-end, it is difficult to win by volume, and may also face the risk of being swallowed up by competitors.
The reason is that the competition pattern of the electric two-wheeler market is clear, and leading enterprises can be extracted from the price war to enhance the bargaining power of the downstream, and these enterprises can increase R&D investment in the development of high-end products with high gross margins after the profitability of these enterprises is improved.
Taking Yadi as an example, its R&D expenses increased from 134 million yuan in 2015 to 605 million yuan in 2020, with an average annual compound growth rate of more than 30% during the period. In the first half of 2021, the company's research and development expenses reached 339 million yuan, an increase of 63.2% year-on-year. In the high-end market, Yadi also launched flagship products such as Guanneng 2.0 series, and as of September 2021, the cumulative sales volume of Yadi Guanneng series has reached 3 million units.
In the foreign market has not yet been fully opened, the high-end market penetration rate is still low, to the competitors to the market, is a card that Maverick Electric must play. So we can see that Maverick Electric launches low-cost products on the one hand, and vigorously expands sales channels on the other hand. In the single quarter of Q4 2021 alone, Maverick Electric added 422 new stores in China. By the end of 2021, the number of Mavericks stores in China will reach 3108. The international sales network expanded to 42 distributors in 50 countries.
Sales channel expansion was followed by a significant increase in sales and marketing expenses. In Q4 2021, the Company's sales and marketing expenses reached RMB99.8 million (including RMB4 million in equity incentives), an increase of 65.9% year-on-year, mainly due to an increase in advertising and promotional expenses. Sales and marketing expenses accounted for 10.1% of revenue, an increase of 1.1 percentage points year-on-year. The increase in sales and marketing expenses is also another major reason why the company's Q4 revenue increase is not increased.
On the bright side, the sales of Maverick Electric's products prove that the company's brand influence is positively improving. The company unveiled five new products at EICMA2021 in Milan, including the MQiGT-EVO, a 125cc electric moped, the first 150cc hybrid moped, the YQi, an electric bike, and two other KQi series kick scooters. It is reported that MQiGT-EVO has been shipped in 2021, RQi electric motorcycles and 150cc displacement light hybrid motorcycle YQi will be shipped in 2022; BQi will be available in 2022, starting at $1500.
With the further improvement of the company's product matrix, the sales situation of Maverick Electric is expected to continue to improve. The company expects full-year 2022 sales to be between 1.5 million and 1.7 million units, up 45% to 64% year-on-year. It is expected that the revenue in Q1 of 2022 will be between 657 million and 712 million yuan, an increase of 20% to 30% year-on-year. If the future profitability of Maverick Electric is also well repaired, the company will still look forward to driving in a straight line at the "crossroads" of growth.