Events:
The company announced results KuaiBao: in 2019, the company achieved revenue of 7.483 billion yuan, an increase of 0.38% over the same period last year; operating profit of-643 million yuan, compared with 252 million yuan in the same period in 2018; and net profit of-584 million yuan, compared with 261 million yuan in the same period of 2018.
Event comments:
The market for new energy vehicles in Europe is accelerating. In January 2020, the electrification of European new energy CR5 countries (Germany, Norway, the United Kingdom, the Netherlands, France) increased significantly, and the penetration rate of new energy vehicles in Germany and France reached 6.5% and 11%, respectively, and sales increased by 138% and 227% respectively over the same period last year.
Environmental regulations require 95 per cent of average CO2 emissions from new car sales in Europe to be less than 95g / km in 2020, and adequate new energy subsidies from countries such as Germany and France will jointly boost new energy penetration in 2020. We expect sales of new energy vehicles in Europe to double in 2020.
The company's Chongqing Bishan factory OBC mass production delivery, 19Q4 revenue increased 43% month-on-month. 2019Q4, the company's single-quarter revenue of 2.49 billion yuan, an increase of 43% month-on-month, an increase of 19% over the same period last year. The company's meta subsidiary car charger has domestic and foreign important customer orders such as BMW, Volkswagen, Porsche, PSA and Dongfeng, Peugeot Citroen, SAIC, Geely, etc., and the company's Chongqing Bishan factory has achieved mass production and delivery to meet the needs of the Chinese market and the European market. In the future, with the continuous mass production of customer product orders, it will bring important increments to the company's revenue and profits.
With light travel, the financial situation is expected to reverse quickly. In 2019, the company conducted a comprehensive inventory of accounts receivable, other receivables, inventory, intangible assets, goodwill and other related assets, with a total impairment of 648 million yuan, resulting in a reduction of 578 million yuan in net profit. Among them, the provision of receivables is mainly affected by customers BAIC Yinxiang and Zhongtai Motors. As the company's overseas business volume, high-end new energy vehicles, luxury brand customers account for an increase in revenue, the company's overall operational stability will be boosted, and the financial situation is expected to continue to improve.
Investment advice:
After the company's Chongqing Bishan factory is put into production, the operation will enter a comprehensive inflection point. After the impairment of goodwill, inventory, intangible assets and receivables in 2019, the financial situation will turn upside down when we are young in 2020. After the release of Chongqing capacity of the company's car charger, the new energy business is expected to expand in an all-round way and is expected to become the core investment target in the field of electric intelligent network connection. Due to the 19Q4 revenue growth rate slightly higher than expected, we raised the company's 20-21 revenue from 88.1, 10.44 billion yuan to 89.6, 10.605 billion yuan, net profit is expected to be 3.0, 450 million yuan, maintain the target price of 26 yuan, maintain the "buy" rating.
Risk hint: the progress of electrification in Europe is lower than expected; Volkswagen MEB platform sales are lower than expected; home appliances and consumer electronics industry boom is lower than expected.
