Incidents:
On February 26, 2024, in order to implement the “investor-oriented” development concept of listed companies and achieve improvements in the quality, investment value and level of sustainable development of Everweft Lithium Energy's business development, the company formulated a “Double Improvement of Quality and Return” action plan.
Investment highlights:
The company attaches importance to R&D, and actively develops new products and technical reserves in response to industry trends. Since its launch, R&D investment in the main business has been increased year by year. In the past 3 years (the first three quarters of 2021/2022/2023), R&D expenses reached 13.22/1.9 billion yuan respectively, accounting for 7.8%/5.9%/5.5% of revenue, respectively. The company has trained a R&D team of more than 5,000 people, built a 230,000-square-meter high-level research institute, built 19 large-scale R&D laboratories and pilot lines to strengthen the transformation of achievements, respond quickly to downstream demand, and form an enterprise technology development system adapted to market competition and enterprise development needs.
The overseas layout is progressing smoothly, gradually opening up a new situation of “global manufacturing, global service, and global cooperation”. 1) North American layout. The company's wholly-owned subsidiary EVE ENERGY USholding LLC and ELECTLIFIED POWER HOLDCO LLC, DAIMLERTRUCKS & BUSES USHOLDING LLC, and PACCAR INC have jointly invested to establish a joint venture in the US. The joint venture will invest in the construction of battery production capacity, which is mainly used in the designated North American commercial vehicle sector. At the same time, partners and their affiliates will become the main customers of the joint venture company and will be purchased All or most of the products. 2) Hungarian layout. The company's wholly-owned subsidiary Ewei Hungary signed a site agreement with a subsidiary of the Hungarian Debrecen government to build a 450,000 square meter production base in Debrecen, Hungary, based on domestic manufacturing advantages and operating experience, to build large-scale production capacity for lithium-ion power batteries for large cylindrical passenger vehicles. 3) Southeast Asia layout. The company's wholly-owned subsidiary, Yiwei Malaysia, signed a site agreement with PEMAJUKELANGLAMA SDN.BHD and its holding company to build a “cylindrical lithium battery manufacturing project”, supporting electric two-wheelers and power tool manufacturers in Malaysia and Southeast Asia, which is an important step for the company to improve its global industrial layout. The company and Energy Absolute Public Company Limited Group plan to jointly establish a joint venture in Thailand to build a battery production base of at least 6 GWh using this joint venture as the implementing entity.
We actively give back to investors through various methods such as continuous cash dividends+implementation of buybacks, and the use of directors and supervisors to increase their holdings. 1) The company has always attached great importance to investor returns. Since its listing, it has continued to pay cash dividends, with a cumulative cash dividend of 1,051 billion yuan over the past ten years (2013-2023). The company distributed cash dividends of 1.60 yuan for every 10 shares to all shareholders in 2022, for a total of 327 million yuan in cash dividends. In the future, the company will continue to coordinate the dynamic balance between company development, performance growth and shareholder returns according to the stage of development, achieve a “long-term, stable and sustainable” shareholder value return mechanism, and continuously enhance investors' sense of acquisition. 2) Implement repurchases to help stabilize the market. Based on confidence in the company's future development and recognition of the company's value, the company launched repurchase plans in February 2024 and August 2023, respectively, to buy back part of the company's shares through centralized bidding transactions with its own capital of not less than 100 million yuan, no less than 200 million yuan and no less than 150 million yuan, and no more than 300 million yuan, respectively. 3) Use methods for directors and supervisors to increase their holdings to boost confidence. By increasing the holdings of directors, supervisors, senior management, etc., we share development results with investors, stabilize the market, and boost confidence.
Profit forecast and investment rating: We expect the company's net profit to be 41, 56, and 6.6 billion yuan respectively in 2023-2025. The current stock price corresponds to 16, 12, and 10 times PE. Based on the fact that the company's global competitive advantage is still significant, we maintain a “buy” rating.
Risk warning: demand for new energy vehicles falls short of expectations; demand for energy storage falls short of expectations; prices of raw materials have risen sharply; industry competition has intensified; uncertainty about repurchase progress and dividend matters.