Text | Financial Street Old Lee
At the beginning of 2022, when China's capital market was at its worst, it once fell to the freezing point, and the auto sector fell sharply. Lao Li has always mentioned that industrial development will affect the capital market, but the capital market will not affect industrial development. Although the market is the worst in three years, this does not affect the rising momentum of China's new energy automobile industry.
The culprit that led to the freezing point of the market is global inflation, and destabilizing factors such as public health events and the Russo-Ukrainian war have also made the already fragile global economy worse, bringing new challenges to countries around the world. The more chaotic the times, the more "moths" will always appear in the countries of the world, and in the capitalist market, taxation is the best way to alleviate economic pressure.
Recently, US President Biden proposed to tax the domestic rich. On wealth, the first to lie on the gun is definitely Tesla CEO Musk, according to the market value, Musk to pay 24.2 billion US dollars (about 153.65 billion yuan) tax, just equivalent to a fine of a small Peng car, old Li can't help but come up with a sentence in his mind: "Foreign leeks are also leeks."
It is not a joke to punish a small peng, even the traditional giants may not be able to bear it, how lethal is this policy?
The day before yesterday, the Great Wall announced its 2021 financial report, which showed that the operating income of Great Wall Motors in 2021 was as high as 135.4 billion yuan, which was not as much as the tax that Musk had to pay - the tax that Musk had to make up was nearly 20 billion yuan more than the annual income of Great Wall Motors.
You know, Great Wall Motors is the world's top ten auto companies by market value, even if it is the United States' General Motors, Ford, compared with Great Wall Motors is also the same order of magnitude of market value, this policy really has to push down, Lao Li can't help but worry about the US auto industry.
As we all know, the overall development trend of the current domestic automobile market is that the market share of fuel vehicles has declined, and the market share of new energy vehicles has continued to grow. If you want to find a company from domestic car companies where fuel vehicles and new energy vehicles are growing, and take into account overseas development, while establishing core barriers to the supply chain, it is not Great Wall Motors.
March and April is the time when major companies issue annual reports, Lao Li has been tracking the annual reports of various companies, in Lao Li's view, Great Wall Motors released its best annual report in history.
First, Great Wall Motors is the second most outstanding financial report among all domestic new energy vehicle companies, second only to BYD; second, Great Wall Motors is the best financial performance of all domestic fuel vehicle companies, far surpassing BYD. Partner Lao Li once joked that Great Wall Motors is the best in new energy among fuel vehicle companies, and it is the best in new energy companies, which has been recognized by many fund managers.
In accordance with the principle of conciseness and conciseness, Old Li first commented on several core annual report data of Great Wall Motor from the perspective of capital:
1. Operating income: Operating income in 2021 was 136.4 billion yuan, an increase of 32.04% year-on-year. This is the growth rate of growth stocks, Lao Li has always said that we must use the perspective of growth to see the Great Wall, last year's growth rate and market value of great wall motors are basically positive correlation, and in contrast, in 2020, great wall motors revenue growth rate of only 7.38%.
2. Net profit: 2021 corporate net profit of 6.73 billion yuan, an increase of 25.41% year-on-year, although the net profit growth rate is not as good as the revenue growth rate, but the overall rate of Great Wall Motors is narrowing, coupled with the expectation of revenue, next year's net profit should be very good.
3. Number of R&D personnel: In 2020, the number of R&D personnel of Great Wall Motors was 19,000, and the number of R&D personnel in 2021 reached 21,000, which basically indicates the development trend of the company. Many friends have been mentioning R & D investment, Lao Li wants to say that talent is the foundation of technology, as of the end of last year, the total number of employees of Great Wall Motor Company was 78,000 people, an increase of 23.4% year-on-year. The continuous growth of the number of employees, especially the number of R&D personnel, has left more room for everyone to imagine.
From the perspective of the industry, the Great Wall's annual report this year has performed very well, and after the release of the annual report, the secondary market still gives a higher rating.
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Many buyers and sellers believe that great wall motor revenue is expected to reach 200 billion yuan in 2022, a year-on-year growth rate of more than 40%, but with the rise in raw material prices, the net profit growth rate should still be slightly inferior to revenue, and everyone predicts that next year's net profit range will be between 9 billion and 11 billion yuan.
Many friends ask, why does the market continue to be optimistic about the revenue and profit of the Great Wall? There are three reasons for this:
First, the advantages of supply chain and core technology will continue to be demonstrated. Regarding the layout of Great Wall Motors in the electrification and intelligent supply chain, Lao Li will not explain too much here, mainly talking about the application of technology. In the first two months of this year, the proportion of Great Wall Motors' lemon, tank and coffee intelligence platform models reached 75.1%, the proportion of intelligent models increased to 88.1%, and the proportion of sales of models with more than 150,000 yuan increased to 15.5%, which shows that the core technology built by Great Wall Motors in the past few years has been marketized, and it is time to "pick fruits".
Second, the development momentum of high quality and high gross profit drives high revenue. When it comes to these words of high quality, many friends feel empty-headed, but this is really the most concise explanation. Great Wall Motor is a very pragmatic enterprise in the industry and pays attention to landing. In 2021, its bicycle ASP (average sales price) reached 106,000 yuan, an increase of 15.0% year-on-year, of which the bicycle ASP in the fourth quarter of 2021 reached 115,000 yuan, an increase of 5.8% from the previous quarter.
With the acceleration of intelligence and electrification, Great Wall Motor's bicycle ASP will grow, specifically the tank 500, WEY brand full range of DHT PHEV, Euler ballet cat, lightning cat and punk cat will become high gross profit products, which lays the foundation for high net profit.
Third, the margin of the annual report expense ratio continued to decline, and the profit growth rate was optimistic. In the annual report, Great Wall Motor's gross profit margin was 16.2%, which is indeed lower than that of the new forces, but we believe that its growth potential is larger. There are two reasons, one is that its next year's bicycle ASP will continue to increase, bringing high revenue, the second is that the three fees (sales / management / finance) will narrow, in 2021, the three fees rate is 3.8%/3.0%/-0.3%, year-on-year -0.2pct/+0.5pct/-0.7pct, the three fee rate margins are rapidly declining, one in and one out is superimposed, making the profit growth rate in 2022 more optimistic.
Seeing this, many friends will ask, the automobile industry is performing so well, the company's annual report is also so good, why is the capital market not satisfactory?
Lao Li also communicated with many friends, and everyone agreed that the capital market has the law of the capital market, inflation is the general trend of this year, and the capital market can only follow the trend.
It is true that from a rational point of view, the lithium battery industry chain represented by the Ningde era and the vehicle target represented by Great Wall Motors have reached the best investment price, and there is no problem with the fundamentals of the enterprise, and Great Wall Motors is still developing at a high speed.
But the problem is that, according to the past laws of the capital market, in the context of global inflation, in the short term, growth stocks have no comparative advantage, cyclical stocks have returned to the center of the stage, oil, coal, agriculture, which have been abandoned by everyone in the past three years, have appeared, as for how long, we still have to look at the changes in the macro environment.
Frankly speaking, no one in the market can judge the time of style conversion now, but Lao Li and many friends who study macro strategies communicate, and everyone still has a certain consensus, that is, under the trend of inflation, for the growth sector with excellent performance such as Great Wall Motors, it is doing medium- and long-term momentum. For example, in the slow bear in 2018, a number of enterprises such as Guizhou Moutai pulled back to a historical low, but the half-year correction ushered in more than two years of long cattle, and Great Wall Motors was the same.
As for where the transfer is? According to the current trend time may be 3-6 months, the turning point of the market is the trend of new energy vehicles, in the trend of Great Wall Motors, when the single-month penetration rate of new energy vehicles exceeds 40% or the single-month sales of Great Wall Motors in the second quarter of 150,000 or more, the market will have funds against the wind, and the reversal trend will come.
If there is no signal of these industrial reversals, then Lao Li wants to say that in this situation, holding the good cards of growth stocks and patiently waiting for the reversal of the capital market is the best way, as for when the capital market will reverse, this is the biggest unknown this year, we look at the medium and long term (June-December), in the most pessimistic time of the market, we are optimistic, it is the best choice.