Incident: The company released a production and sales report for June 2024. In June, the wholesale sales of new energy passenger vehicles was 340,000 units, +35.2% year over year, +2.9% month on month; the total wholesale of 2024M1-6 vehicles was 1.707 million units, +28.8% year over year.
Pure electric passenger cars sold 145,000 units in June, +13.2% year over year, -0.8% month on month; plug-in hybrid passenger car sales in June were 195,000 units, +57.9% year on year, +5.9% month on month.
Technology-driven share growth reached a new high in June. Driven by the company's Dm5.0 new models, the company's wholesale sales continued to perform well. In June, wholesale sales of new energy passenger vehicles were 340,000 units, +35.2% YoY and +2.9% month-on-month; sales of plug-in hybrid passenger vehicles were 195,000 units, +57.9% YoY and +5.9% month-on-month, and continued to grow.
By brand, Dynasty+Ocean/Tensei/Looking Up/Equation Panther sold 325,000 units, 12,275 units, 418 units, and 2,680 units, respectively. The 2024M1-6 has accumulated 1,525, 6.0, 0.55, and 18,000 units, respectively.
The era of fuel consumption 2.0 begins to accelerate the seizure of joint venture fuel market share. On May 28, BYD released DMi5.0 technology. The DMi5.0 has 46.06% engine thermal efficiency, 2.9 L power loss and 2,100 km comprehensive battery life. In June, the BYD Song L DMI-i entered the Ministry of Industry and Information Technology catalog and is expected to be listed in Q3. We believe DMi5.0 is expected to strengthen the company's leading position in technology in the plug-in hybrid field, and further launch of new 5.0 models. The company is expected to further seize the joint venture fuel vehicle market share and achieve increased sales; the Dm5.0 upgrade is expected to further strengthen its sales volume. Scale effects promote profit improvement.
High-end: High-end products have increased sales and profits in the past year. 2024 will be a big year for BYD's high-end products. Key models such as Tensei Z9 (July), flagship sedan (expected Q3), and family SUV (expected Q4), Looking Up U7, Equation Panther 8 (July), and Equation Leopard 3 (expected Q3) will be launched centrally in Q3-Q4. Based on insurance sales in 2023, the sales volume for fuel vehicles over 30-35/35-40/40-50/500,000 yuan is about 2.6 million units. We are optimistic about Tenshi, Equation Bao, and look forward to a double increase in sales and profits.
2024 Increase overseas layout, global ocean and sky. In terms of exports, overseas sales in June reached 27,000 units, +156.2% year over month, and -28.0% month over month. The month-on-month decline was mainly due to the impact of the off-season overseas. The 2024M1-6 sold a total of 203,000 units overseas, +173.8% year over year, continuing the growth trend. Recently, BYD's Uzbek factory PLUS DM-i Champion Edition was officially launched, with a production capacity of 50,000 units in the first phase. In 2024, the company will increase investment in overseas markets, set up factories in Brazil, Uzbekistan, Hungary, and Indonesia, and accelerate exports. We believe that the company's overseas expansion is expected to usher in rapid development in Europe, Southeast Asia, Australia and New Zealand, and that going overseas is also expected to boost profits.
Investment advice: We are optimistic that the company's technology-driven product strength and brand strength will continue to improve, accelerate its overseas market to become the world's leading NEV company, and maintain profit forecasts. It is estimated that 2024-2026 revenue will be 8,336.0/10,003.3/1,16038 billion yuan, net profit of 398.1/511.8/63.61 billion yuan, EPS 13.68/17.58/21.85 yuan, corresponding to the closing price of 246.80 yuan/share on July 1, 2024, PE is 18/14/11 times, respectively. Maintain a “Recommended” rating.
Risk warning: The risk of a downturn in the car market. Sales volume and demand for new models fall short of expectations, and overseas progress falls short of expectations.