On October 26, the company released the third quarter report: the company achieved operating income of 4,013 billion yuan in the first three quarters of 2023, +3.30% year-on-year, net profit of 480 million yuan, +7.93% year-on-year, and net profit of 456 million yuan after deduction, +11.70% year-on-year. 23Q3 achieved net profit of 187 million yuan, +21.86%/-1.24% year-on-year, respectively, and minus 180 million yuan in non-net profit, +26.50%/+0.50% year-over-year.
The company announces a repurchase plan to be used to implement equity incentives or employee stock ownership plans. The company issued an announcement stating that it plans to use its own funds to repurchase some stocks through centralized bidding transactions. It is intended to be used to implement equity incentives or employee stock ownership plans. The total repurchase capital is not less than RMB 10,000 million (inclusive) and no more than RMB 120 million (inclusive). The repurchase price shall not exceed RMB 10/share (including principal amount), not higher than 150% of the average trading price of the company's shares in the 30 trading days before the board of directors passed the decision on the repurchase of shares. Based on the total repurchase capital limit of 120 million yuan and the maximum repurchase price of 10 yuan/share, the number of repurchases is 12 million shares, accounting for about 0.95% of the company's current total share capital. Based on the total repurchase capital limit of 10,000 yuan and the maximum repurchase price of 10 yuan/share, the number of repurchases is 10 million shares, accounting for about 0.79% of the company's current total share capital. This move shows the company's confidence in continued and stable development in the future. At the same time, it can further improve the company's long-term incentive mechanism, fully mobilize the enthusiasm of core managers and core business and technical backbone, and jointly promote the company's long-term development.
Earnings for a single quarter increased year over year, and the expense ratio was generally stable. 23Q3 The company's net profit was 187 million yuan, +21.86% year-on-year. The company's sales/management/R&D/financial expenses for the first three quarters of 2023 were 2.44, 1.98, 2.16, and 0.42 billion yuan, respectively, +0.05%, +6.62%, -4.51%, -4.12%, and 23Q3 sales/management/R&D/financial expenses were 0.84, 0.68, 0.80, and 0.14 billion yuan, -6.24%, +3.18%, +1.92%, +169.76%, month-on-month, 0.74%, +1.86%, +16.83%, +194.15%
The scale of the new energy vehicle business is growing rapidly, and it is planned to invest 370 million yuan to build new production capacity. Benefiting from the promotion of NEV industry policies and the accelerated construction of charging piles for NEV charging infrastructure, the scale of the company's new energy business continues to grow, and production capacity is no longer able to meet demand. The company plans to invest 370 million yuan in the construction of a new energy industrial park project in Hongshan District of Wuhan City to make full use of the cluster benefits of the local NEV industry to help develop the company's NEV business and meet the company's overall strategic layout in central China.
Maintain a “Highly Recommended” investment rating. Based on the company's first three quarter results and current industry fundamentals, we adjusted our profit forecast. We expect net profit of 68/7.8/960 million yuan in 2023-25, corresponding to a price-earnings ratio of 13/12/9 times, maintaining a “highly recommended” investment rating
Risk warning: macroeconomic environment and policy risks, industry competition risk, raw material price fluctuation risk, company operating risk, new energy demand falling short of expectations or changes in technology routes, etc.