The market value has shrunk by more than 480 billion! BYD, the stock price is not worthy of performance

BYD completed its first overtake over Tesla, which was a milestone event.

In December, BYD's sales reached 341,000 units, with a cumulative annual sales volume of 3,024,400 units, and BYD successfully completed the annual sales target of 3 million, which is a transcendence in the era of new energy vehicles.

This is a memorable moment for BYD, and it is also a bumper year for BYD's partners.

According to media reports, after reaching the sales target of 3 million, Wang Chuanfuhao threw about 2 billion yuan to "give red envelopes" to dealers who meet the standards, and will reward dealers who meet the standards according to the standard of 666 yuan per car.

BYD's bright sales data is an indisputable fact, but it is contrary to BYD's stock price. After the sales volume was announced, there was a trend of opening high and moving low, and finally closed down 2.73%.

According to Kanjian financial statistics, this is not a recent occasional situation, in the past year, with the rise of BYD's sales, the performance is getting better and better, but the stock price has not kept up with the pace of performance, but has fallen to a certain extent.

As of the close of trading on January 5, BYD's share price closed at 192.68 yuan per share, with a total market value of 560.9 billion. Compared with the highest point of 357.61 yuan per share in July 2022, BYD's share price has nearly halved, and its market value has shrunk by more than 480 billion. So, what exactly is the market worried about?

It is difficult for the stock price to keep up with the performance

For BYD, the past 2023 has been a fruitful year, especially in terms of sales.

According to statistics, BYD's cumulative annual sales in 2023 will be 3,024,400 units, and it has sold more than 300,000 units per month for three consecutive months since October.

So, what is the concept of monthly sales of 300,000 units?

Taking this year's best-selling car-making new force Ideal as an example, its annual sales were 376,000 units, that is to say, BYD's sales in December were already very close to the annual sales of Li Auto, and compared with the traditional car companies, the GAC Group is expected to sell 2.5 million units for the whole year, that is, BYD has achieved corner overtaking.

Driven by sales, BYD's performance will also achieve significant growth in 2023.

As of the first three quarters of 2023, BYD's cumulative revenue was 422.3 billion yuan, a year-on-year increase of 57.75%, and its net profit was 21.37 billion yuan, a year-on-year increase of 129.47%. It is reported that in the past 2020-2022, BYD's net profit was 4.234 billion, 3.045 billion and 16.62 billion respectively, with a total net profit of 23,899 million in three years. In other words, the net profit in the first three quarters of 2023 is already comparable to the past three years.

Judging from the profit margin data, BYD's profit margin data has also improved significantly after the scale effect.

As of the third quarter of 2023, BYD's gross profit margin has reached 19.79%, and its net profit margin is 5.29%, which is the highest third quarter of BYD's profit margin data in recent years. Judging from the extended data, it is currently the heyday of BYD.

However, although sales have skyrocketed and performance has increased significantly, BYD's stock price has gone out of the opposite trend.

As of the close of trading on January 5, BYD's total market capitalization was 560.9 billion. Compared to its high, its market capitalization has shrunk by about 480 billion.

The reasons for BYD's stock price to fall endlessly, Kanjian Finance believes that there are two aspects:

market factors;

Institutional sell-off. Taking Warren Buffett's Berkshire as an example, since the first announcement of the reduction in August 2022, as of December, Buffett's Berkshire Hathaway has reduced its holdings of BYD shares 13 times, and its shareholding ratio has dropped from 19.92% to less than 8%.

From the perspective of the number of institutional positions, as of the third quarter of 2023, BYD's institutional holdings are 376, a significant decrease of 296 compared with 672 institutional positions in the same period last year, and a decrease of 938 compared with 1,314 institutional positions in the fourth quarter of last year.

What is the market worried about?

As the world's leading enterprise of new energy vehicles, although BYD's sales are "explosive", it is not without hidden dangers.

In terms of sales volume, BYD's sales will exceed 3 million in 2023, but the ability to "make money" still needs to be improved.

Specifically, among the 3 million sales, the Qin series, which has the lowest price of more than 90,000 yuan, has the highest sales, with 482145 annual sales, followed by BYD's Song PLUS Champion Edition, with a cumulative annual sales of 427071 units, and then BYD's Dolphin and Seagull, with annual sales of 367419 and 280217 respectively.

In 2023, the Han series and Tang series, which are relatively priced and positioned, will sell 228383 and 137184 units, respectively, while BYD Seal will sell only 127323 units. From the proportion of models, it is not difficult to find that BYD's low-priced models do sell well, but there are still bottlenecks in the sales of high-end models.

From the current point of view, maintaining sales is a correct strategy, after all, the proportion of models with more than 300,000 in the market does not exceed 15%. However, compared with Tesla, although the sales advantage has appeared, the revenue gap is still not small.

Therefore, BYD must conquer the high-end field.

With the increase in the penetration rate of new energy vehicles, new energy vehicles have shifted from the first half of electrification to the second half of intelligence. In the second half of 2023, the "Huawei series" has achieved good sales in the industry with technologies such as intelligent cockpit and intelligent driving, which is a trend.

In terms of intelligent driving technology, 2023 is regarded as the "first year of urban NOA landing", and various car companies from Huawei and Wei Xiaoli to Changan and Great Wall have accelerated the layout of urban NOA tracks. According to data from Kaiyuan Securities, in the first half of 2023, 209,400 new cars were delivered by domestic passenger car front-loading NOA, a year-on-year increase of 108.98%. However, BYD's layout, as the sales champion, seems to be a bit lagging behind. Zhao Changjiang, general manager of the sales department of BYD's Denza brand, said that the high-speed NOA will not be pushed on the Denza N7 until the end of December last year, and the urban NOA will not be pushed on the Denza N7 until Q1 2024.

In general, since 2023, BYD has increased its investment in the field of intelligence, especially in intelligent driving, and BYD's current software team for autonomous driving business has thousands of people.

However, intelligence is not achieved overnight, and BYD wants to accelerate the catch-up in intelligence, and it still takes time and process. Of course, the current divergence between BYD's stock price and performance shows that some investors are still worried, and BYD should communicate more with the market in the context of focusing on sales, so as to eliminate the market's concerns.