Source: China Fund News
The fourth listed new car-making force may be born!
Following "Wei Xiaoli", zero-run cars in the second echelon of the new domestic car-making forces took the lead in opening Hong Kong stock IPOs.
On March 17, Zhejiang Zero Run Technology Co., Ltd. (hereinafter referred to as "Zero Run Auto") submitted a listing application to the Hong Kong Stock Exchange, with CICC, Citi, JPMorgan Chase and CCB International as joint sponsors.
Self-developed and self-produced, sales growth rate is leading
According to public information, Zero-Run Automobile was founded in 2015, and the company's CEO Zhu Jiangming is also the founder and CTO of security giant Dahua Shares. Coming from a technical background, he has focused on the independent research and development of core technologies since the beginning of the zero-run car, and it is precisely because of the backing of Dahua that the zero-run car can develop and produce all the key software and hardware in the core system of the intelligent electric vehicle and electronic components, realizing the unification of the underlying interface, algorithm and data communication protocol, which is also one of its core advantages that distinguish it from other new car-making forces.
According to Frost & Sullivan's data, zero-run cars are currently the only emerging electric vehicle companies in China with global independent research and development capabilities, and they are also the emerging electric vehicle companies with the highest degree of vertical integration in China.
In terms of automotive products, it is reported that the first intelligent pure electric coupe S01 market sales previously launched by zero-running cars are not good, and then the company changed its strategy and launched the intelligent pure electric mini car T03 to quickly open the market. According to Frost & Sullivan, according to the single pure electric vehicle model C-end insurance volume launched by China's emerging electric vehicle companies in 2021, the T03 of the zero-run car ranks third among the best-selling models.
The sharp increase in sales of zero-run T03 has made the market position of zero-run cars rise rapidly, becoming the second echelon player of the new car-making force after "Wei Xiaoli". In July last year, Zhu Jiangming, CEO of Zero-Run Automobile, revealed when announcing the company's zero-run 2.0 strategy that the company's future goals include "surpassing Tesla in three years with self-driving technology" and "reaching 800,000 vehicles in 2025".
However, from the perspective of sales, the gap between zero-running cars and Tesla is still very large. The data shows that Tesla delivered a total of 936172 vehicles in 2021, while zero-running cars sold only 43,748 vehicles in 2021. However, from the perspective of growth rate, the performance of zero-run cars is still more eye-catching.
From the sales of the whole year of 2021 and the sales of February, the zero-run car is not as good as "Wei Xiaoli", but in the second echelon of the new car-making force, it is comparable to the sales volume of WM Motors. In addition, from the perspective of year-on-year growth, whether it is the whole year of 2021 or February this year, the year-on-year growth rate of zero-run car sales is in the first place.
According to the zero-run auto prospectus, the company mainly focuses on China's mid-to-high-end mainstream new energy vehicle market with prices ranging from 150,000 yuan to 300,000 yuan, according to Frost & Sullivan' data, zero-running cars are the fastest growing company among China's leading emerging electric vehicle companies in terms of delivery volume.
Revenue in 2021 will exceed 3 billion
In terms of revenue, the revenue growth rate of zero-run cars has been obvious in recent years. According to the prospectus, the total revenue of zero-run vehicles in 2019, 2020 and 2021 was about 117 million yuan, 631 million yuan and 3.132 billion yuan respectively. Among them, automobile and parts sales are the main revenue, and the growth rate is obvious, the total sales revenue of automobiles and components in 2019, 202 and 2021 is 117 million yuan, 616 million yuan and 3.058 billion yuan, respectively.
On the other hand, the company's losses are also intensifying. According to the prospectus, the operating losses of zero-run cars in 2019, 2020 and 2021 were about 731 million yuan, 869.5 million yuan and 2.868 billion yuan respectively; the annual losses attributable to the company's equity holders were 901 million yuan, 1.1 billion yuan and 2.8457 billion yuan, respectively. The cumulative net loss in the three years is about 4.7 billion yuan, and zero-run cars are expected to continue to lose money in 2022.
In terms of gross profit, the gross profit margin of the company in 2019, 2020 and 2021 was -95.7%, -50.6% and -44.3%, respectively. Zero-run cars said that with the increase in delivery of higher-margin models and the expansion of production scale, it is expected to further improve its gross margin level.
From the perspective of R & D investment, the investment in zero-running cars has increased year by year in recent years, but the proportion of revenue has decreased. According to the prospectus, as of now, zero-run cars have more than 1,000 R&D personnel, accounting for 33.9% of the company's total employees. The Company's R&D expenditure in 2019, 2020 and 2021 was $358 million, $289 million and $740 million, accounting for 306.4%, 45.8% and 23.6% of the total revenue respectively.
In terms of sales expenses, the proportion of sales expenses of zero-sports cars to revenue decreased. The Company's sales expenses in 2019, 2020 and 2021 were RMB131 million, RMB155 million and RMB428 million, accounting for 112.1%, 24.5% and 13.7% of the revenue respectively. Zero-run cars said the decline was mainly due to the significant increase in the company's earnings and the economies of scale brought about by the expansion of the business, and it is expected that future sales expenses will increase with the expansion of the business.
In terms of cash flow, the prospectus shows that as of December 31, 2021, the cash and cash equivalents of Zero Pao Auto were 4.338 billion yuan. Zero-Run Said its current asset position improved in 2021 compared to 2020, thanks to cash flow from financing.
The fourth new force to list a car
Automobile manufacturing is inseparable from the support of funds, in recent years, the fire of new energy vehicles is "burning money", for the new forces of car manufacturing, can be listed financing is an important step to ensure the development of the company.
On March 17, the media reported that GAC Aegian, a wholly-owned subsidiary of GAC Group, had completed a total financing of 2.566 billion yuan. GAC motor revealed that AE will launch its shareholding system transformation and A round of financing in a timely manner, further introduce strategic investors, and actively seek an appropriate time to list in the future.
In addition, it is reported that Nezha Automobile also plans to launch a Hong Kong stock IPO this year, and WM Motors has abandoned the listing on the Science and Technology Innovation Board and intends to switch to Hong Kong stock listing.
In the second echelon of the new car-making forces, zero-run cars can be said to have fired the first shot of the Hong Kong stock IPO. At the same time, if it can successfully land on the Hong Kong Stock Exchange, then zero-run cars will also become the fourth new car-making force that has been successfully listed in addition to Weilai, Xiaopeng Automobile and Ideal Automobile.
It is reported that at present, zero-run cars have obtained multiple rounds of financing, investors include Dahua Shares, CICC Capital, Sequoia China, CRRC, Shanghai Electric, etc., with a cumulative financing amount of nearly 10 billion yuan. According to the prospectus, the company's major shareholders are Zhu Jiangming, Dahua Technology, Guoshun Leading, Sequoia Zhisheng, Guosen Securities and so on.
For the product planning of the future market, Zero Run Automobile said that it will focus on China's high-end mainstream new energy vehicle market, and continue to launch new models to expand and upgrade our company's intelligent electric vehicle portfolio and customer base. In the future, the company plans to launch eight new models by the end of 2025 at a rate of one to three models per year, covering sedans, SUVs and MPVs of various sizes.
For fundraising purposes, Zero Company said it plans to use the funds raised for smart electric vehicle research and development, increase production capacity, expand business and brand awareness, operating funds and general corporate purposes. It is reported that in 2023, zero-run cars will open the first overseas flagship store in the European market.