Sales of luxury cars such as Aston Martin, Rolls-Royce and Bentley increased sharply in 2021, of which the Chinese market contributed a considerable part of the force. In such a context, domestic luxury car dealers have achieved a bumper harvest of both performance and market value, of which the market value of Meidong Motor Hong Kong shares has increased by about 40 times in the past five years!
Car sales have slowed down as a whole, and sales of ultra-high-end luxury cars have bucked the trend.
Although the overall performance of the global car market is relatively lacklustre in 2021, sales of luxury and ultra-luxury cars have bucked the trend.
Rolls-Royce, a global ultra-high-end luxury car representative, recently announced that it achieved the best annual sales in the 117 years since the brand was founded in 2021, delivering 5586 new cars to customers around the world, an increase of 49 percent over the same period in 2020. Among them, the best sales record has been set in many global markets, such as Chinese mainland, the United States and the Asia-Pacific region.
Even the chief executive of Rolls-Royce was surprised: "this is an unprecedented level, it's incredible." For the first time in my decades of career, I have seen strong growth in all markets around the world, and no market is in recession. "
Rolls-Royce is not the only car company that saw a surge in sales in 2021. Bentley, which also locates luxury cars, sold 14659 cars in 2021, up 31% from 2020, also setting a record for the company.
Porsche, another high-end car brand, sold 301915 cars worldwide in 2021, up 11% from a year earlier. It is worth mentioning that the above luxury brands have all achieved growth in the United States, Europe and China.
The reason for the increase instead of a decline in global luxury car sales, in addition to luxury cars less affected by the shortage of chips, may also be related to the global COVID-19 epidemic.
On the one hand, the COVID-19 epidemic directly enhanced the consumption desire of the rich. "many people have witnessed the death of people in their community by COVID-19, which makes them realize that life may be short, so it is best to have fun in time, which is of great benefit to Rolls-Royce sales," said the chief executive of Rolls-Royce. "
On the other hand, in order to deal with the epidemic, the world's major economies have implemented loose monetary policies in the past two years, which has pushed up asset prices represented by stocks and commodities, creating a large number of young rich. Rolls-Royce says many buyers will be first-time owners of Rolls-Royce in 2021, and many young people who have become rich in the stock market and cryptocurrency have joined the ranks of luxury car owners.
There is a strong demand for luxury cars in the Chinese market, and the performance of luxury car dealers has greatly increased.
In fact, in the past two years, luxury cars have become a new engine for the development of the automobile market, in which the Chinese market is the main force of luxury car consumption.
For example, China has become Porsche's largest single market in the world for the seventh year in a row. China will remain Porsche's largest single market in 2021, with delivery in China accounting for 31.7% of its total sales.
Lamborghini delivered 8405 new cars in 2021, up 13% from 7430 in 2020. Among them, the Chinese market is the largest sales market outside the United States, with sales of 935 new cars for the whole year, an increase of 55 percent over the same period last year.
In addition, the Chinese market has once again become the strongest growth market for Bentley in 2021, accounting for 27.5% of its global sales, and sales are close to the same level as the American market for the first time in nearly a decade.
Data show that the penetration rate of luxury cars in China has increased at an annual rate of 1-2pct in the past five years. As of August 2021, the penetration rate of luxury brands (domestic cars) reached 13.3%, and the penetration rate of luxury cars in Zhejiang, Jiangsu, Beijing, Shanghai and other provinces and cities exceeded 20%.
China's luxury car market is still hot, and luxury car dealers benefit the most. This can be withdrawn from the capital market-many listed car dealers in Hong Kong have unusual ability to make money, and in recent years, thanks to the boom in the luxury car market, the leading dealers have achieved a bumper harvest of both performance and stock prices.
Caihua statistics found that as of December 31, 2021, there were 18 companies involved in the Hong Kong stock automobile retail industry (Hang Seng industry category), of which 10 had a total market capitalization of more than 1 billion Hong Kong dollars (HK $, the same below) and 3 with a total market capitalization of more than 10 billion yuan.
Specifically, the total market capitalization of Zhongsheng Group (00881.HK), 01268.HK (American East Motor) and 03669.HK (Yongda Motor) reached 146.834 billion yuan, 50.164 billion yuan and 20.562 billion yuan respectively, ranking the top three respectively.
(information as at 31 December 2021)
According to the data, Zhongsheng Group focuses on luxury and mid-to-high-end brand combinations, including Mercedes-Benz, Lexus, Audi, BMW, Regal, Jaguar Land Rover, Toyota, Nissan, Honda and other brands. Meidong Motor also focuses on mid-range brands and mainstream luxury brands, including Porsche, BMW, Lexus, Audi, BMW Mini, Toyota and Hyundai. Yongda mainly represents Bentley, Aston Martin, Porsche and other international well-known luxury car brands.
In terms of performance, of the 10 companies with a total market capitalization of more than 1 billion, almost all of the semi-annual reported operating income and net profit in 2021 achieved positive growth (only Zhengtong Motor's net profit decreased in the first half of 2021 compared with the same period last year). For example, leading Zhongsheng Group's revenue in the first half of 2021 increased by 50.1% compared with the same period last year, and its net profit increased by 61.3% over the same period last year. East Motor's revenue in the first half of 2021 increased by 39.8%, and its net profit increased by 78.4%. Yongda Motor's revenue in the first half of 2021 increased by 44.9% year-on-year, and its net profit increased by 121% over the same period last year. To a certain extent, this confirms the strong demand of the domestic luxury car market.
Luxury car dealers are highly profitable, and the market value of East American cars has increased 40-fold in the past five years.
Traditionally, car dealers may be a hard-working and unprofitable business, but this is not the case, especially luxury car dealers, whose profitability is no less than that of the Volkswagen industry.
Taking the three car dealers with the largest market capitalization listed in Hong Kong stocks as an example, Zhongsheng Group, Meidong Motor and Yongda Motor have all maintained a high level of return on net assets in the past three years, even exceeding most manufacturing companies. Among them, Zhongsheng Group's return on net assets reached 21.30%, 22.51% and 22.98% respectively in 2018, 2019 and 2020, with an average ROE of more than 20% in the past three years, and even increased year by year.
Meidong Motor, the second largest in the industry by market capitalization, is equally profitable, with a return on equity of 29.81 per cent in 2018, 35.64 per cent in 2019 and 30.40 per cent in 2020, while the ROE level has remained at around 30 per cent in the past three years.
In addition, even Yongda, which is slightly less profitable, has been able to maintain a return on equity of around 15% in the past three years.
In addition, the performance of the above three leading distributors has grown rapidly in recent years. Taking 2020 as the cut-off year, Zhongsheng Group, Meidong Automobile and Yongda Motor have achieved compound growth rates of 20.19%, 33.26% and 13.96% respectively in the past five years, and the compound growth rate of net profit in the past five years has reached 64.42%, 49.01% and 25.38% respectively. It can be said that the growth is high.
With the sharp rise in performance, the stock market values of Zhongsheng Group, Meidong Automobile and Yongda Automobile Port are close to5There has been a rapid growth in 2000. Data show that Zhongsheng Group, Meidong Motor and Yongda Motor2017年1月1The total daily market capitalization is respectively148.75100 million yuan,12.3100 million yuan and57.72100 million yuan, three companies2021年12月31The total daily market capitalization reaches respectively.1468.34100 million yuan,501.64100 million yuan and205.62100 million yuan5Over the years, the market capitalization has increased by about9倍、40Double sum3倍。