Incident: BYD announced the June production and sales report. A total of 0.342 million cars were sold in June, +35% over the same period last year.
Cumulative sales of 1.613 million vehicles from January to June 2024, +28.5% year-on-year.
Monthly sales in June exceeded 0.34 million units, and Q2 sales volume was +40.3% YoY/+57.6% YoY. 1) In June 2024, BYD achieved sales of 0.342 million vehicles, +35.0% YoY/+3.0% month-on-month; of these, 0.34 million passenger cars and 1,447 commercial vehicles were sold. In June, pure electric passenger cars sold 0.145 million units, +13.2% year on year; plug-in hybrid passenger cars sold 0.195 million units, +58% year over year. From January to June, the total sales volume was 1.613 million vehicles, +28.5% year-on-year, of which 1.607 million passenger cars were sold. 2) In June, the high-end series Tense+ Yewang+ Equation Bao sold 0.015 million vehicles, accounting for 4.52% of total passenger car sales, -0.1 pct. Among them, Tension sold 0.012 million vehicles, +11% YoY/+0.4% month-on-month; Looking forward to selling 418 vehicles, and Equation Panther sold 2,680 vehicles.
3) Q2 sold 0.987 million vehicles, +40.3% YoY /57.6% YoY. Among them, Ocean + Dynasty sold 0.938 million vehicles, +40.5% YoY/+60.1% month-on-month; Tense+Equation Leopard+ sold 0.045 million vehicles, +16.3% month-on-month.
Globalization is progressing smoothly. A total of 0.2 million 2024H1 vehicles have been exported. We believe that annual exports are expected to reach 0.4-0.5 million vehicles. In June, the company exported 0.027 million passenger cars, +156.2% year-on-year; in January-June, it exported 0.203 million passenger cars, +173.8% year-on-year. On June 27, the Song PLUS DM-i Champion Edition, the first mass-produced NEV at BYD's Uzbek plant, went offline. The first phase of the plant plans to produce two models, the Song PLUS DM-i Champion Edition and the Destroyer 05 Championship Edition. The first phase is expected to produce 0.05 million units per year to meet the sales needs of the Central Asian market. Furthermore, the company is actively deploying in markets such as Africa, South America, and Asia, and we believe that overseas sales are expected to form strong profit support.
The high sales increase in Qin L/Seal 06 verifies DM 5.0 product capability, and subsequent product sales can be expected. Two models were launched on May 28. In June, the Qin series sold 0.068 million units, +20% month-on-month; the Seal series sold 0.024 million vehicles, +71% month-on-month. The SEAL 07 DM-i and Song L DM-i have been declared by the Ministry of Industry and Information Technology. We expect to launch the market in Q3 and be equipped with the DM 5.0 system. Sales flexibility can be expected after product iteration, and the company's profit margin is expected to increase due to scale effects.
High-end models are being planned intensively, and profit margins are expected to increase. The Tensei Z9GT/N9 is expected to be launched within the year. The brand's annual sales target is 0.2 million units; the D9 can currently maintain monthly sales of around 0.01 million units. Equation Bao 8 and Leopard 3 (the first pure electric model of the Fangchengbao brand) are expected to be launched in the second half of the year; it is hoped that they will continue to impact the million-class luxury market.
Investment advice: We expect the company's net profit to be 38.13/47.42/55.79 billion in 2024-2026. Corresponding to the current stock price PE is 19.8/15.9/13.5 times, respectively, maintaining a “buy” rating.
Risk warning: Sales of new models fall short of expectations, high-end models fall short of expectations, and increased market competition.