Core views:
The company's 24Q1 net profit was deducted before and after, and the investment income was -2.5%, -2.0%, and -9.7%, respectively. The company released its quarterly report for 2014, achieving revenue of 143.07 billion yuan, -1.9% year-on-year and -35.4% month-on-month. The company's 24Q1 sales volume was 834,000 units, -6.4% year-on-year, and -49.2% month-on-month; export and overseas sales volume was 227,000, -11.8% year-on-year, and -38.8% month-on-month. 24Q1 The year-on-month revenue growth rate of the company was better than sales volume, reflecting an improvement in the product structure. The company achieved net profit of 27.1 billion yuan and 2.12 billion yuan before and after deduction in 24Q1, -2.5% year-on-year, -2.0%, +0.6% month-on-month, and +269.9%. The net profit growth rate of the 24Q1 company after deduction was significantly better than revenue, mainly due to the lower base due to higher asset impairment losses and credit impairment losses in 23Q4. The company achieved investment income of 2.75 billion yuan in 24Q1, -9.7% year-on-year and -33.0% month-on-month.
The 24Q1 company's gross profit margin and net profit margin were -1.0pct and -0.9pct, respectively. The company's 24Q1 gross profit margin and net profit margin were 8.8% and 2.1%, respectively, -1.0pct and -0.9pct, respectively, and -1.9pct and +0.5% month-on-month respectively. The company's expenses rate for the 24Q1 period was 10.5%, -0.04pct year-on-year, +0.3pct; among them, sales, management, R&D, and financial expenses rates were 3.7%, 3.4%, 2.8%, and 0.7%, respectively, -0.2pct, -0.4pct, +0.1pct, and +0.5pct, respectively, -0.5pct, -0.5pct, -0.5pct month-on-month, respectively. The 24Q1 net operating cash flow was 4.55 billion yuan, +53.9% year-on-year and -121.4% month-on-month, mainly due to the subsidiary SAIC Motor Group Finance Co., Ltd. adjusting the loan size and optimizing the deposit structure.
Profit prediction and investment advice: As the leading company with the strongest comprehensive strength in the domestic automobile industry, it is using the core capacity building of its own brands as the main starting point, driven by the continuous and rapid implementation of major innovation achievements, supported by digital transformation to achieve combined development of manufacturing and services, and focusing on building a new SAIC with a more influential brand, more competitive system, and more flexible institutional mechanism. We expect the company's 24-26 EPS to be 1.26/1.33/1.44 yuan/share, respectively. Combined with comparable company valuations, we will give 24 times 15 times PE, a reasonable value of 18.94 yuan/share, and maintain a “buy” rating.
Risk warning: industry sentiment is declining; chip shortage exceeds expectations; competition exceeds expectations, etc.