Low-altitude concept, the heat continues!
Since the beginning of 2024, with the implementation of measures in various places, the low-altitude economy has remained hot, and after the May Day holiday, the low-altitude concept has taken off again and has become one of the biggest attractions in the market today.
As the most basic and important carrier of low-altitude flight, e-VTOL (electric vertical take-off and landing aircraft) has also become the hottest track at present, and it is expected that by 2031, the global e-VTOL market will exceed 30 billion US dollars.
The low-altitude economy is a typical representative of new quality productivity, and related enterprises such as EHang, Wanfeng Aowei, CITIC Haizhi, Zongshen Power, Wolong Electric Drive, Rice Information, and Jianxin have attracted much attention.
Among them, Wanfeng Aowei has a global leading advantage in the field of general aviation aircraft manufacturing, ranks second in the world in the fixed-wing aircraft business, and the new product will become the world's first pure electric aircraft in commercial operation.
In the field of e-VTOL production, there are many companies with qualifications, such as EHang, Fengfei, Wofei Changkong, Volante, Xiaopeng Huitian, etc., but these companies have not yet been listed on A-shares.
Another popular company is CITIC Haizhi. In contrast, Wanfeng is a "manufacturer" and its business is global, while CITIC is an "operator" and only faces the domestic market. Wanfeng Aowei at the manufacturing end obviously has a higher ability to resist risks.
Moreover, compared with Guangwei Composites, AVIC Optoelectronics, Wolong Electric Drive, CATL and other accessories enterprises, Wanfeng Aowei, as a complete machine factory, will give priority to enjoying market dividends in the initial stage of low-altitude economy.
Judging from the current situation of the low-altitude economic industry, Wanfeng Aowei has a strong certainty.
So, where is the core advantage of Wanfeng Aowei development?
1. "Dual-engine" product layout
One is the general aviation aircraft business
Before the rise of the concept of low-altitude economy, Wanfeng Aowei acquired Canadian and Austrian diamond aircraft in 2017 to lay out the general aviation aircraft business. Today, Wanfeng has multiple R&D centers around the world and is one of the world's top three manufacturers of piston fixed-wing aircraft.
On the one hand, Wanfeng Aowei optimizes the product structure and increases the proportion of high value-added models, and on the other hand, it increases the global market share of diamond aircraft through licensing and technology transfer.
At present, Wanfeng Diamond has all the property rights of 18 models for various purposes, and in 2023, the company's general aviation business revenue will be 2.769 billion yuan, an increase of 37.94% year-on-year.
One is the "lightweight" business of Auto Zero
Although Wanfeng Aowei has a huge advantage in the field of low-altitude economy, it accounts for a larger proportion of revenue in automotive metal lightweight parts. In 2023, the company's auto parts revenue will reach 13.438 billion yuan, accounting for 82.91%.
For every 10% weight reduction in the car body, fuel consumption can be reduced by 6-8%, and braking distance can be reduced by 5%-8%, which not only reduces energy consumption, but most importantly, greatly reduces safety risks.
Aluminium is an ideal material for lightweight automobiles. The company's main business is aluminum alloy automobile wheels (the part of the wheel center shaft).
It is estimated that the global sales of aluminum alloy wheels will reach 427 million pieces in 2025, and the market size will reach 16.43 billion US dollars.
Wanfeng Aowei aluminum alloy auto parts customers are all over the world, such as General Motors, Volkswagen, Mercedes-Benz, BMW, Toyota and other foreign companies, as well as BYD, Changan, Hongqi, Geely and other domestic enterprises.
With the support of the company's product technology upgrading and stable major customers, in 2023, Wanfeng Aowei New Energy Automobile will have an annual production capacity of 5,907,300 aluminum alloy wheels, a sales volume of 5,897,100 pieces, and a conversion rate of 99.83%, basically no inventory.
With the continuous expansion of the market scale, the company is also actively building new bases to seize market share.
Second, strong profitability
Since 2020, Wanfeng Aowei has performed well, with a compound annual growth rate of 9% in the past four years.
Among them, there will be a slight decline in 2023, with revenue of 16.207 billion yuan, a year-on-year decrease of 1.07%, and a net profit attributable to the parent company of 727 million yuan, a year-on-year decrease of 10.14%.
The main reason for the decline in Wanfeng's performance was the impairment of the goodwill of its subsidiary Wuxi Xiongwei by 279 million yuan. If the above impact is excluded, in 2023, the company's net profit will increase by 24.35% year-on-year.
In the first quarter of 2024, Wanfeng achieved revenue of 3.54 billion yuan, a year-on-year decrease of 2.04%, mainly because Wuxi Xiongwei was not included in the statistical scope of this period, and achieved a net profit of 227 million yuan, a year-on-year increase of 1.25%.
Although Wanfeng's performance will decline in 2023, its profitability will not be bad at all.
The company's gross margin in 2023 is 20.33%, the highest level in the past five years, and the net profit margin in the first quarter of 2024 reached 8.24%.
Third, there is a lot of room for growth in the future
1. New material for auto parts - magnesium alloy
With the popularization of new energy vehicles, the requirements for lightweight automobiles are increasing.
In addition to aluminum alloy wheels, magnesium alloy materials also have obvious weight reduction effects, such as 78% weight reduction ratio for auto parts foot pedals and 72% weight reduction for valve parts.
It is estimated that by 2030, the market size of magnesium alloy automotive die castings in China will reach 1.31 million tons.
Wanfeng Aowei acquired Magnesium Reading in 2015 and became the world's largest magnesium alloy supplier, entering the magnesium alloy track strongly, with a market share of more than 65% in North America.
In 2023, Wanfeng Aowei magnesium alloy product production capacity will reach 15,000 pieces. In the future, with the continuous improvement of the lightweight degree of automobiles, coupled with the obvious cost advantage of Continental as the world's largest supplier of raw magnesium, Wanfeng's magnesium alloy business development space is great in the future.
2. Low-altitude economy - e VTOL field
Although the mainland's low-altitude economy will have a trillion market in the future, many people are worried that it will take a long time for flying cars to really "take off", and they are still in the stage of speculation, but in fact, they have gradually landed.
In 2022, the number of general airports in mainland China will reach 399, with a compound annual growth rate of 18.55% in the past five years, and the total number of registered general aviation aircraft will reach 3,186, with a ten-year compound growth rate of 8.6%.
Wanfeng Diamond eDA40 pure electric aircraft has successfully made its first flight, and is the world's first electric aircraft to apply for EASA/FAAPart23 certification, which can reduce operating costs by more than 40% compared with traditional ones. At the same time, the new model DA50 has obtained the recognition certificate of China and the United States, and has gradually been mass-produced.
As the heat climbs, Wanfeng Aowei has also been subject to some controversy.
One is on February 4, Wanfeng Aowei said that Wanfeng Aircraft has reached a strategic cooperation with a well-known global OEM.
Some investors speculated that it was Tesla, but the company was warned for not clarifying in a timely manner. Although the partner manufacturer is not Tesla, the research and development of e VTOL is real, and the R&D advantage is still great.
The other is that from April 24 to April 29, Centennial Life, the major shareholder of Wanfeng Aowei, reduced its holdings by a total of 9 million shares, about 134 million yuan, through centralized bidding, which caused many speculations.
In fact, in recent years, the life of insurance companies has not been easy, Centennial Life has held Wanfeng for nearly nine years, and this time a small amount of shares at a high level is also for the company's asset allocation upgrade and profit recovery.
In general, Wanfeng Aowei's advantages are obvious in both automobile lightweight and flying car business. Although there is a bit of controversy at the moment, the company is strong, there is plenty of room for development, and as the business continues to develop, the future is very certain.
The above analysis does not constitute specific investment advice. The stock market is risky, and investors need to be cautious.
Pay attention to Little Elephant and get the most valuable "Growth 20: 20 Companies with the Most Growth Potential in 2024" investment report now!