The capital market's criteria for judging an auto company are often considered from multiple levels, among which valuation is the core key factor. Of course, there are times when the valuation is undervalued, such as the recently popular Zeekr, which is a seriously undervalued pure electric dark horse, and when encountering such a car company, the capital market should also make a comprehensive judgment from other levels. Today, let's take a look at why the valuation of ZEEKR is undervalued?
Judging from the market delivery, ZEEKR's performance has been improving. At the beginning of May, ZEEKR announced the latest delivery volume, and the ZEEKR brand delivered more than 16,000 new cars in April, a year-on-year increase of 99% and a month-on-month increase of 24%, setting a new record high. Among them, from January to April, ZEEKR increased by 111% year-on-year, continuing to rank first in the sales of more than 200,000 Chinese pure electric brands.
From the perspective of gross profit margin of the whole vehicle, thanks to the heavy asset empowerment of Geely Holding Group, the ZEEKR brand has achieved asset-light operation and brought large-scale results. According to the recently updated prospectus of ZEEKR, the gross profit margin of ZEEKR is also continuing to increase, in 2021, ZEEKR coincides with the start-up period, but with its strong strength, the gross profit margin of ZEEKR is positive, and in 2023, the gross profit margin of ZEEKR will reach 15%, an increase of 10.3 percentage points year-on-year from 4.7% in 2022, and the high-end pure electric is second only to Tesla, surpassing new car-making forces such as Xiaopeng and Weilai. This also means that ZEEKR is expected to become the earliest and fastest profitable electric vehicle company in addition to Tesla.
Based on the market delivery of ZEEKR and the gross profit margin of the whole vehicle, the valuation of ZEEKR is currently seriously underestimated, and the long-term value of its brand can be expected.
Looking at the subscription of ZEEKR IPO, according to the content of the previous public prospectus of ZEEKR, ZEEKR will be listed on the New York Stock Exchange with the code "ZK", and it is expected to issue a total of 17.5 million ADS shares, with an issue range of ADS 18-21 US dollars per share. According to the information on May 8, ZEEKR has been oversubscribed nearly 5 times, ending the subscription one day in advance, from the perspective of this subscription speed, the capital market is optimistic about the long-term value of ZEEKR, from another point of view, the valuation of ZEEKR at this stage is seriously underestimated.
In fact, for the capital market, one of the most important indicators for judging valuation is the growth rate, and looking at the performance of ZEEKR in recent years, its growth rate is also remarkable. According to the prospectus, ZEEKR's total revenue has grown rapidly in the past three years, of which, in 2021, ZEEKR's total operating income will be 6.5 billion yuan, in 2022, ZEEKR's total operating income will be 31.9 billion yuan, and in 2023, ZEEKR's total operating income will be 51.7 billion yuan, of which, ZEEKR's revenue in 2023 will increase by 62% year-on-year, which is very good in the industry.
According to the prospectus, in 2021, the sales revenue of ZEEKR will be 1.54 billion yuan, in 2022, the sales revenue of ZEEKR will be 19.67 billion yuan, and the sales revenue of ZEEKR in 2023 will be 33.9 billion yuan, of which, in 2023, the sales revenue of ZEEKR will increase by about 72.4% year-on-year.
It is worth noting that compared with traditional automobile manufacturers, ZEEKR's revenue composition shows a diversified trend, which mainly comes from the three electric business, vehicle sales, R&D and other services, with the revenue of this part in 2021, 2022, and 2023 being 4.983 billion yuan, 12.228 billion yuan, and 17.761 billion yuan respectively, with a cumulative income of 34.972 billion yuan in 3 years.
Overall, the delivery performance of ZEEKR continues to improve, repeatedly hitting record highs, and in terms of total revenue, vehicle gross profit margin and vehicle sales revenue have shown a year-on-year growth trend, combined with the fact that the current ZEEKR IPO ended the subscription one day earlier than the original plan, and received nearly five times oversubscription, the current valuation of ZEEKR is indeed seriously underestimated, but this is more beneficial than disadvantageous for ZEEKR, which means that the future development space of ZEEKR will be broader, which is also conducive to the better growth of ZEEKR.