Incident: The company released its 2023 annual report. In 2023, the company achieved revenue of 151.3 billion yuan, +24.8% year over year; net profit to mother of 11.33 billion yuan, +45.3% year over year; gross profit margin of 18.4% and net profit margin of 6.3%. Among them, Q4 achieved net profit of 1.45 billion yuan, +60.8% year over year, and -35.2% month on month; realized gross profit margin of 19.6%, -2.9 pp year on year, and +1.2pp month-on-month.
The penetration rate of autonomous new energy sources has increased rapidly, and independent profits are steady. In 2023, the company achieved sales volume of 2.553 million vehicles, a year-on-year high of +8.8%, a six-year high. The cumulative sales volume of autonomous passenger vehicles was 1.597 million units, +14.9% year-on-year, and the annual sales volume of its own new energy brand was 474,000 units, +74.8% year-on-year. In 2023, net profit attributable to mother was 11.33 billion yuan, +45.3% YoY, net profit not attributable to mother was 3.78 billion yuan, +16.2% YoY. In 2023, Changan Automobile built the three smart electric brands of “Changan Qiyuan, Deep Blue Auto, and Avita” to meet the needs of different market segments; Changan Qiyuan's cumulative annual sales volume exceeded 40,000 units; Deep Blue delivered 137,000 units throughout the year, of which the Deep Blue SL03 delivered more than 100,000 units. It only took 14 months from the launch of the first model to sales exceeding 100,000 units, creating a new record of 100,000 sales for the fastest independent new energy brand; Avita sold over 20,000 units in just 30 days.
The “Haina Baichuan” plan is speeding up overseas, and export efficiency is improving. Changan Automobile's cumulative overseas sales volume in 2023 reached 358,000 vehicles, an increase of 43.9% over the previous year. Among them, exports of its own brands reached a record high of more than 230,000 vehicles, and overseas revenue exceeded 20 billion yuan, +53.1% over the same period last year. The scale and profit increased rapidly. The company announced the “Haina Baichuan” plan in April 2023, and established five major regional divisions, namely Central and South America, the CIS, Middle East Africa, Europe, and Southeast Asia; held a Southeast Asia brand conference in Bangkok in November. DEEPAL vehicles officially entered Thailand, radiating the world and opening a new chapter of expanding the global market; building the first overseas production base - Changan Automobile's manufacturing base in Thailand, with an investment of 20 billion baht, with a total scale of 200,000 vehicles/year. The first phase has a production capacity of 100,000 vehicles per year and will be put into operation in the first quarter of 2025; in Saudi Arabia, Chile, Mexico and other countries The market sales volume ranks among the top Chinese brands.
Join hands with Huawei to write a new chapter in automotive intelligence. On November 25, 2023, Huawei and Changan Automobile signed a “Memorandum of Investment Cooperation” in Shenzhen. Huawei plans to establish a new company. Changan Automobile and its related parties plan to invest to acquire shares in the target company, with a ratio not exceeding 40%. The specific share ratio, investment amount and period will be discussed separately by the two parties. According to the memorandum of understanding, Huawei plans to integrate the core technology and resources of the smart car solution business into the new company. The new company's business scope includes automotive intelligent driving solutions, car smart cockpits, smart car digital platforms, smart car clouds, AR-HUD and smart car lights, etc., and will strive to become a world-class leader in the automotive intelligent driving system and components industry. Both Changan Automobile and Huawei will use their superior resources to accelerate the construction of complete, autonomous, and leading full-stack intelligent vehicle capabilities for the intelligent era.
Profit forecasting and investment advice. EPS is expected to be 0.92 yuan, 1.15 yuan, and 1.36 yuan respectively in 2024-2026, and the corresponding dynamic PE will be 18 times, 15 times, and 12 times, respectively. The company's 24-year plan goals are clear, new cars will continue to be launched, and it is optimistic that growth will accelerate throughout the year and maintain a “buy” rating.
Risk warning: Terminal demand falls short of expectations, product launch pace or falls short of expectations.