Text | Financial Street Old Lee
On the first trading day of the week, the A-share and new energy sectors fell sharply again, with the intraday ChiNext falling by more than 3%, the Ningde era falling by more than 8%, and BYD falling by nearly 5%, and the market was still a green oil. Although the annual reports of domestic new energy and automotive industry chain companies are mostly beyond expectations, the performance of the secondary market is not outstanding, the "slow bear" since December last year has not improved, many institutional fund managers have been withdrawn more than 25%, and the "black first quarter" is not empty.
After entering March, Lao Li's feeling is that the activity of electric new and automobile researchers is getting lower and lower, everyone does not have many telephone conferences, and the attention to the market is not high, especially the researchers in Shanghai have stayed at home to fight the epidemic, and the market has not turned back at all. Everyone understands that no matter how well the fundamentals are studied, without the wind, the market cannot rise.
The recent situation is slightly different, BYD announced the cessation of production of fuel vehicles, Ningde times publicly revealed the "Kirin battery", the new energy vehicle sector appeared a major "bearish", today old Li from the bottom logic and everyone to chat, what is the current fundamental situation of the new energy vehicle plate? Who are the industry leaders of Ning Wang and BYD? When will the two companies recover?
The bearish behind good fundamentals
To summarize the fundamentals of the current new energy vehicles in a simple sentence: in the second quarter of 2022, the new energy vehicle sector is likely to appear behind the boom of the stage "bearishness", and the performance of leading enterprises such as Ningde Times and BYD will determine the overall trend of the plate.
There are two key words here, one is prosperity, and the other is a stage "bearish".
It is not an exaggeration to describe the current new energy automobile industry with prosperity, and it is no exaggeration to say that the high growth rate of new energy vehicles that began in the second half of last year has not ended. Although the official data for March has not yet been released, according to the data obtained by Lao Li, the mainland car sales in March were about 2.2 million units, down about 10% year-on-year, of which passenger car sales were about 1.9 million, of which new energy vehicle sales were about 500,000, more than twice that of the same period last year, and in the first quarter, new energy vehicle sales were between about 1.2 million and 1.3 million, which was also more than twice that of last year.
Friends familiar with the market will find that the growth of new energy vehicles and the shrinking sales of fuel vehicles are the market norm every month this year. We analyze the market with the idea of economics and get such a trend -
At present, the domestic macro environment is not good, residents' income is greatly affected, so the overall domestic car market will not be too good, and most of the current users who buy new energy vehicles are just need users and high-net-worth people, and the changes in the macro environment have little impact on these groups, so the impact on new energy vehicle sales is not large, a drop and a liter, so the penetration rate of new energy vehicles will also grow rapidly.
Prosperity is the norm for new energy vehicles this year, and based on this logic, we can judge that the fundamentals of the Ningde era and BYD will not be too bad. But the problem now is that due to the impact of the epidemic and the supply chain, in the case of the cold secondary market, the market has begun to appear in the new energy sector "bearish", and the stage bearish includes two aspects:
First, the power battery supply chain is bearish, due to supply and demand problems, the price of raw materials upstream of power batteries in the first quarter has risen more and more intensely, the rise of raw materials is no longer a market behavior, the state has also begun to regulate prices with large hands, the Ministry of Industry and Information Technology, the State Administration of Market Supervision has repeatedly said that upstream price control, this will be a 1-2 year tug-of-war, so Ningde times and other enterprises will inevitably be impacted. After the market value of the Ningde era bottomed out in early March, a brief recovery began, but the small rally was immediately hit back by negative news.
The second is the price increase of the whole vehicle, the price increase is not news, all the domestic new energy vehicle companies are adjusting the price, BYD even opened two price increases, some models are expected to increase the total price of more than 10,000 yuan. Although BYD issued an industry announcement on the suspension of fuel vehicles, the impact of price increases on the capital market has not been eliminated, and some researchers believe that the price increase superimposed on the epidemic will have an impact on THE fundamentals of ATD, which will trigger the secondary market bearishness.
Wang Chuanfu also came out to shout and put forward various new views, such as:
"The development of new things has never been equal, from black-and-white television to color television, from feature phones to smart phones, that is, in just a few years, the transformation has been completed, and the speed and efficiency of new things in the Chinese market are faster than in foreign countries."
"The replacement of fuel vehicles by new energy vehicles will only be fast, not slow." We have all gone through the process of electrification of public transport, and the more we end up, the faster the speed of change is beyond imagination, and the same is true for private cars. ”
"According to the speed of industry change last year, if it is a constant speed calculation, by the end of 2022, it is expected that the penetration rate of new energy vehicles in the mainland will reach 35%."
No matter how the number one shouts, in the final analysis, the overall change of the new energy sector still depends on the performance of the Ningde era and BYD, the Ningde era is stable, the new energy upstream is stable, BYD is stable, and the new energy vehicle is stable.
Ningde era and BYD, who holds the bull's ear?
Many friends will ask, Ningde era and BYD, who is the leader in the end? Last year, the answer is undoubtedly the Ningde era, but in the long run, there are still many variables.
Generally speaking, in the early stage of industrial development, the profit margin of upstream enterprises is often better than that of downstream enterprises, in the position of the industrial chain, the Ningde era is higher than BYD market concentration, Ningde era is also more profitable than BYD, so in the early stage of the industry, almost all researchers are supporting the Ningde era. This can be seen through a set of financial report data:
The revenue of CATL in 2020 is 50.319 billion yuan, of which the revenue of the main business power battery system is 39.425 billion yuan, the operating profit is 10.453 billion yuan, and the gross profit margin is as high as 26.51%. In the performance forecast released by CATL on January 27 this year, IT is expected that the net profit attributable to the mother in 2021 will be 14 billion yuan - 16.5 billion yuan, an increase of 150.75% - 195.52% year-on-year.
It is easy to see that the Ningde era is a typical high-margin and high-growth enterprise, and Lao Li wrote in "The wind direction in the second half of the year will change?" It is mentioned that the secondary market gives the Ningde era two valuation codes: one is its high growth rate, the other is a high market share, as long as the Ningde era can maintain a growth rate of more than 30% and a market share of more than 50%, its valuation will not have much impact.
Let's take a look at BYD's financial report: in 2021, BYD's revenue was 216.142 billion yuan, an increase of 38.02% year-on-year, of which automobile-related revenue was 112.489 billion yuan, an increase of 33.93% year-on-year, and it was the first time in history to break through the 100 billion mark, but its gross profit margin was only 17.39%, BYD's market share in the new energy vehicle market was less than 30%, and with the increase of other new forces, BYD's market share will go down.
Here we need to explain the problem of BYD's net profit, in 2021, BYD's net profit was only 3.045 billion yuan, down 28.08% year-on-year; after deducting non-recurring gains and losses, the company's net profit was 1.255 billion yuan, down 57.53% year-on-year. BYD's low net profit was mainly due to the large number of fixed assets and project investments last year:
In 2021, BYD's fixed assets were 61.221 billion yuan, an increase of 12.16% year-on-year; the construction project reached 20.277 billion yuan, a significant increase of 14.165 billion yuan over the same period in 2020.
Recently, there are also people in the industry to put forward the "Ningde down, BYD up" view, Lao Li believes that from the long-term trend point of view, the Ningde era in the power battery plate is indeed facing greater pressure, mainly the market share is difficult to guarantee, the current innovation of the airline, Yiwei lithium energy main price war, with "kill the enemy eight hundred, self-loss of a thousand" way to block the Ningde era, Fordy battery, hive energy and other main engine plant system of the battery enterprises will cause greater damage, The Ningde era must build a new moat to maintain its high growth rate and high market share.
BYD's situation is much better, its Fordy battery is an offensive trend, once Fordy into a strong main engine factory, the market share will be an inevitable trend. From the perspective of the vehicle business, BYD is already a well-deserved top two leader in the industry, and the other is Tesla.
There is a very interesting data, BYD's average bicycle price is close to 150,000 yuan, while Great Wall Motors is about 100,000 yuan, Geely Automobile is less than 90,000 yuan, with the launch of BYD Han hybrid version and the future high-end R project, its average bicycle price will also go higher, which is conducive to the improvement of gross profit margin.
In August 2021, BYD exceeded 300 yuan per share, some brokers proposed BYD's market value of 2 trillion yuan, Lao Li also mentioned in early 2021 "give BYD a high-end brand, over the trillion market value is just around the corner", after last year's National Day, BYD's market value was close to trillion, but unfortunately, the A-share market soon entered the "slow bear". Lao Li believes that when the market recovers again, although BYD's road of 2 trillion yuan is far away, it is only a matter of time before trillion yuan is recovered.
When will Ningde era and BYD rise?
The Ningde era and BYD's recovery have little to do with fundamentals and depend on the macro trend. The secondary market generally divides researchers into three categories: macro, strategy and industry, macro researchers look at the trend of the macro economy, strategy researchers look at the rotation of the plate, and industry researchers look at the fundamentals of the industry and enterprises.
From a rational point of view, the lithium battery industry chain represented by the Ningde era and the vehicle target represented by BYD Automobile have reached the best investment price, and the research of industry researchers is correct, but the problem is that the market does not make money.
Making money depends on macro researchers and strategic researchers, macro trends and the impact of the epidemic has completely dispersed the market logic of the new energy growth sector, and now the logic of making money is that the funds rotate to which plate, which plate makes money, because short-term funds will not go to the growth sector, so buy Ningde times and BYD do not make money.
A-share BYD weekly candlestick chart
Since last year's Central Economic Work Conference, steady growth has always been the main theme, especially after the two sessions, put forward a growth target of 5.5% GDP, under this goal, stable economy and stable development is the top priority. The first feeling of stable economy and steady development is to cut interest rates and fully release liquidity, while the epidemic situation in various places has become an unknown factor in this round, which has caused a greater impact on the economy and allowed infrastructure and other sectors to be reconfirmed by the market.
Stable growth mainly depends on two sectors, one is infrastructure, the other is real estate, the relationship between the investment amount of the two and gdp growth rate will be greater, the need for greater policy release, in order to alleviate the growth pressure, after coal, real estate, steel will be the main theme of the second quarter, in such a macro background, the fundamental research significance of electric new and automotive industry researchers is not large.
Where is the turning point between Ning Wang and BYD? Now no one can say clearly, in fact, the current public fund is not in a hurry, everyone earns management fees, the market is good or bad and everyone's performance has little impact, the secondary market is more involuted than the industry, and everyone gives up the ranking intermittently at these times.
If you have to predict a time period, Lao Li believes that in the current situation, the time of recovery may be 3-6 months later, the turning point of the market lies in the trend and liquidity of new energy vehicles, when the single-month penetration rate of new energy vehicles exceeds 40%, the market will have funds against the wind, the trend of phased reversal will come, and the leader of the reversal must be the Ningde era and BYD.
There is nothing new under the sun, after the "slow bear" in 2018, we ushered in Guizhou Moutai, met WuXi AppTec, stepped on the Ningde era and BYD, and when the market is slow bear, we have to do only patient research and wait for recovery.