Incidents:
On June 6, the company released the May production and sales report: Changan Automobile's wholesale sales volume in May 2024 was 206,800 vehicles, an increase of 3.29% over the previous year.
Sales increased steadily year on year in May and remained basically the same month over month
The company achieved wholesale sales of 206,800 units in May, up 3.29% year on year, down 1.6% month on month, and achieved total wholesale sales volume of 1.1090 million units in January-May, up 12.03% year on year; of these, its own brand sold 171,000 units in May, up 4.70% year on year, down 1.0% month on month, and achieved total sales volume of 932,400 units in January-May, up 11.64% year on year; sales volume of own-brand passenger cars in May was 123,200 units, up 0.1% year on month. 683,600 units, up 8.53% year over year.
Autonomous new energy and overseas sales continued to increase, accelerating global layout. The company continued to optimize product layout, and promoted the joint efforts of the three smart new energy brands of Changan Qiyuan, Deep Blue Auto, and Avita to achieve 55 million autonomous new energy sales in May, an increase of 87.76% year-on-year and 6.4% month-on-month; of these, Changan Origin/Deep Blue Automobile/Avita delivered 13,600 units/14,600 vehicles respectively. The company's own brands achieved overseas sales volume of 33,300 vehicles in May, up 72.93% year on year and 5.2% month on month. A total of 173,900 vehicles were sold in January-May, up 80.81% year on year, accounting for 18.65% of overseas sales of independent brands, up 7.13 pct year on year. The company is speeding up its global layout. In the second half of this year, Changan Automobile will complete the launch of the Avita brand in Thailand and launch the Avita 11, Changan Qiyuan E07, and Lumin models. The launch and introduction of the three new energy brands Deep Blue, Changan Qiyuan, and Avita will be completed in the European, Central and South American, and Middle Eastern African markets, and the launch of the Deep Blue S7 will be achieved. At the same time, the establishment of a European company will be completed to research and lay out production bases.
Become the first batch of L3 intelligent connected vehicle pilot units in the country
On June 4, under the unified leadership and orderly organization of the four ministries and commissions, China achieved phased results in the pilot work on entry and road access to L3 intelligent connected vehicles. After preliminary review and merit-based defense, it was determined that Changan Automobile became the first batch of L3 intelligent connected vehicle pilot units in the country. Changan Automobile has reached another important milestone in the field of intelligent connected vehicles, and also highlights another landmark achievement of Changan Automobile's “Beidou Tianshu” intelligent strategy.
Profit Forecasts, Valuations, and Ratings
We expect the company's revenue for 2024-2026 to be 2240.16/2605.48/319.174 billion yuan, respectively, with corresponding growth rates of 48.06%/16.31%/22.50%, respectively; net profit to mother of 96.02/125.17/15.681 billion yuan, respectively, corresponding growth rates of -15.23%/30.36%/25.27%, EPS 0.97/1.26/1.58 yuan/share, and CAGR-3 11.45%, respectively. Given that the company has excellent product building capabilities and leading electric intelligence technology, it is expected to gain market recognition in the new wave of new energy sources, and many products will be launched in 2024, which is expected to be a strong support for sales, so it is recommended to continue to pay attention.
Risk warning: Risk of NEV sales growth falling short of expectations, risk of sales of new models falling short of expectations, risk of declining fuel vehicles, risk of increased competition in the industry.