Brief performance review
On April 15, the company released its 24Q1 quarterly report. 24Q1's revenue was 79.8 billion yuan, -10.4% year-on-year, -24.9% month-on-month, net profit of 10.51 billion yuan, +7.0% year-on-month, -19.0% month-on-month, net profit of 9.25 billion yuan after net profit not attributable to mother, +18.6% year-on-year, and -29.5% month-on-month.
The results exceeded expectations.
Management analysis
1. Shipments increased year-on-year, and profitability remained strong. 1) Volume: The company's 24Q1 is expected to ship 95 GWH, +27% to 36%, power/energy storage is expected to be 76/19 GWH respectively; 2) Profit: The company's 24Q1 gross profit margin is 26.4%, +5.1pct year over month, and +0.8pct month-on-month, and +1.7pct month-on-month (main cause management, financial rate increase), net profit margin to mother 13.2%, year-on-year +2.1pct, profitability remains strong; 3) Guarantee & Rebate: Expected profit accruing: Debt of $57.3 billion, compared to 23 billion At the end of the year, +5.7 billion yuan, and quality/rebate accruals are expected to account for half; 4) Other income: The company's Q1 other revenue was 3.2 billion yuan, +134.5% over the same period last year, of which 1.82 billion yuan was subsidized. In addition, value-added tax credits for advanced manufacturing enterprises contributed significantly.
2. Inventory continues to improve, and cash flow continues to increase. 1) Inventory: Thanks to the optimization of the company's VMI system's inventory management, the company's inventory at the end of 24Q1 was about 44 billion yuan, a slight decrease from 45.4 billion yuan at the end of 23; 2) Fixed assets: 23Q1 fixed assets of the company was 114.5 billion yuan, -0.8% from the end of 23, based on a relatively high depreciation rate and slowing capital expenditure, fixed asset growth, and future unit depreciation is expected to decrease; 3) Cash flow: 288.6 billion yuan, +9% from the end of 23, operating cash flow of 28.36 billion yuan, +35% compared to the end of 23, inventory Management optimization and declining procurement prices of raw materials have brought positive contributions.
3. Increase global share and consolidate competitiveness with new technologies and models. In terms of share, in January-January '23, the company had a global market share of 38.4%, +5pct, domestic market share +4pct; in terms of new technology, Kirin 5C batteries launched the ideal MEGA, the Shenxing Battery Omnipotent Series debuted the Xiaomi SU7 Pro, and the Tianheng energy storage system solved the pain points of energy storage life; in terms of new scenarios, it is expected that condensed batteries will take the lead in applying aircraft scenarios; in terms of new models, CatlinSide models are expected to be the first to be used in aircraft scenarios; in terms of new models, the CatlinSide model is being promoted and gradually established for consumption User mentality.
Profit Forecasts, Valuations, and Ratings
The company has brought a strong moat to global power and energy storage battery leaders, long-term high-intensity R&D and industrial chain integration. The power and energy storage circuit where the battery is located is currently in the early stages of rapid development, and the company is a scarce R&D leader in high growth. In 24-26, the company's profit is estimated at 470, 542, and 62.3 billion yuan, corresponding to PE of 18, 16, and 14X, respectively, maintaining a “buy” rating!
Risk warning
Global electric vehicle sales fell short of expectations, and global energy storage installations fell short of expectations.