Great Wall Motor (601633): Continuous optimization of product structure in line with expectations

Great Wall 西安耍耍网 Motor (601633): Continuous optimization of product structure in line with expectations
Event: The company released its 2018 annual report: it achieved operating income of 992 in 2018.3 ‰, the ten-year average of 1.9%; net profit attributable to mother 52.1 ppm, a 10-year increase of 3.6%; deduct non-net profit 38.9 ‰, an average of 9 in ten years.5%; Proposed payout of 0.29 yuan (including tax). The sales performance is expected to be in the auto market, and the performance is in line with expectations. In 2018, the domestic auto market was too sluggish and car sales increased.8%, passenger car sales decreased by 4 each time.1%.The company’s overall sales in 2018 were 105.30,000, sometimes even slightly down by 1.6%, but still continue the overall performance of the auto market.The Haval series sold 76.60,000, 10 in the past ten years.1%, under pressure, mainly due to the significant increase in H2 sales.Pickup sales of 13.80,000 vehicles, an increase of 15 in ten years.2%, a major contribution to the company’s previous sales volume.Euler’s sales of 3,515 vehicles contributed to the new incremental increase.The growth rate of the company’s operating income is basically close to the growth rate of sales volume, and the performance is acceptable under the overall average downturn in the industry.Overall, the company’s revenue and net profit are in line with our expectations. Promotions affected gross profit margin, and the expense ratio dropped significantly. The company’s gross profit margin in 2018 was 16.7% for years before 20171.7pct, first of all, because the downturn in the domestic auto market has led to increased competition, the company increased terminal discounts to benefit consumers.The company’s three rates for 2018 are 7.6%, a ten-year average of 1.8 points.The selling expense ratio is 4.6% (+0.2pc), mainly due to the increase in promotional costs during the 杭州夜网论坛 World Cup;7%, the same as the same period; financial expense ratio -0.5% (-0.6 pct), initially due to the receipt of interest income from performance bonds; the company’s R & D expenditure in 2018 was 39.60,000 yuan, an increase of 17 in ten years.7% (56% capitalized), R & D expense ratio 1.8%.We believe that the competition in the converted car market is easing, and the company’s terminal is expected to be replaced, and the replacement product structure will be improved. Profit forecast and investment recommendationsIn 2021, the EPS will be 0.73 yuan, 0.85 yuan, 0.93 yuan, corresponding to 2019?In 2020, PE will be 10 respectively.7 times, 9.1x, 8.4 times.Upgrade the company’s rating to “overweight.” Risk warning: The domestic auto industry is weaker than expected; the company’s product sales are lower than expected.

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