Growth: In spite of the short-term downturn, auto consumption is in the fast-off phase. According to the sales force split method, the sales growth of passenger cars in 2011-2013 was 9.7%, 18.9%, and 14.2%, respectively. . The sales growth rate is split into five parts: The industry’s stable internal demand comes from the accumulation of social wealth and the demonstration effect of car buyers; the demand driven by the economic growth exceeding expectations is due to the increase in the expected future income growth; Determining factors include policy incentives, specific revenue thresholds, etc.; inflation and liquidity effects.
According to the sub-regional sales split method, the sales growth of passenger cars in 2011-2013 was 0.8%, 30.1%, and 23.7%, respectively. In 2010, the number of passenger cars in China reached 46, which reached the level of popularization of automobiles in Japan (1968) and South Korea (1990). In terms of provinces and cities, using different levels of R-values ​​corresponding to the elasticity of ownership, combined with forecasts of GDP growth, we can obtain prediction data of the number of provinces and cities, and can further calculate sales growth.
Economic Cycle and Mesocosm Industry Chain: Typical macro-driven industry of early cycle: Industrial added value, price level and liquidity suggest the automotive industry boom. Passenger cars and trucks are representative of alternative consumer goods and capital goods and theoretically benefit from the early stage of economic recovery and the mid-expansion period respectively.
Among them, the impact of fixed asset investment on trucks is greater; passenger car consumption is usually suppressed by inflation; the mobility represented by M1 also affects the demand of two types of vehicles.
Zhongguan confirms that the industry chain is booming and demand is king. Sales volume of automotive upstream steel, tire rubber and glass increased year-on-year and the number of cars increased. The sales volume of trucks is also affected by the downstream investment in fixed assets, real estate development and the volume of road freight. The impact of raw material costs on the profitability of the automotive industry is relatively weak, and the capacity utilization rate is the core of the gross profit margin. The key to the research on the capacity utilization rate lies in the forecast of the demand.
Market Verification: The macro background of excess returns and absolute returns. From the macro background, historically, the economy of passenger vehicles appeared to be in a period of recovery and expansion; investment opportunities in trucks appeared in the short-term top areas of economic expansion. The automotive sector tends to outperform the market in rising prices, and passenger cars are more offensive investment targets than trucks. The excess profits of the entire vehicle segment and the steel, automobile glass, tires and real estate sectors are highly correlated. Among them, the excess returns of the truck segment and the logistics sector also exhibit synchronous resonance. Automobile sales, gross margins and industrial policies are important indicators for locking up investment opportunities in the automotive sector.
Valuation: There is still room for improvement in the market value of leading companies. Compared with the automotive industry in the United States, Japan, and South Korea, A-share vehicles have higher PE and PB than other markets, but verticality is historically low compared to history. Judging from the relative valuations of the auto industry and the country's stock market, Shanghai Auto (joining the self-selected stock) is equivalent to Toyota and Hyundai, and Foton Motor (joining the self-selected stock) has a relative market valuation comparable to that of Mann. In terms of market value, Shanghai Automotive’s market capitalization ratio is lower than its revenue share compared to Hyundai’s and Toyota’s.
The impact of gross margin on the valuation is that the trucks are significantly larger than the passenger vehicles segment. The ROE of the current auto sector has fallen from its high point but its historical gross profit rate is at a historically high level.
According to the sub-regional sales split method, the sales growth of passenger cars in 2011-2013 was 0.8%, 30.1%, and 23.7%, respectively. In 2010, the number of passenger cars in China reached 46, which reached the level of popularization of automobiles in Japan (1968) and South Korea (1990). In terms of provinces and cities, using different levels of R-values ​​corresponding to the elasticity of ownership, combined with forecasts of GDP growth, we can obtain prediction data of the number of provinces and cities, and can further calculate sales growth.
Economic Cycle and Mesocosm Industry Chain: Typical macro-driven industry of early cycle: Industrial added value, price level and liquidity suggest the automotive industry boom. Passenger cars and trucks are representative of alternative consumer goods and capital goods and theoretically benefit from the early stage of economic recovery and the mid-expansion period respectively.
Among them, the impact of fixed asset investment on trucks is greater; passenger car consumption is usually suppressed by inflation; the mobility represented by M1 also affects the demand of two types of vehicles.
Zhongguan confirms that the industry chain is booming and demand is king. Sales volume of automotive upstream steel, tire rubber and glass increased year-on-year and the number of cars increased. The sales volume of trucks is also affected by the downstream investment in fixed assets, real estate development and the volume of road freight. The impact of raw material costs on the profitability of the automotive industry is relatively weak, and the capacity utilization rate is the core of the gross profit margin. The key to the research on the capacity utilization rate lies in the forecast of the demand.
Market Verification: The macro background of excess returns and absolute returns. From the macro background, historically, the economy of passenger vehicles appeared to be in a period of recovery and expansion; investment opportunities in trucks appeared in the short-term top areas of economic expansion. The automotive sector tends to outperform the market in rising prices, and passenger cars are more offensive investment targets than trucks. The excess profits of the entire vehicle segment and the steel, automobile glass, tires and real estate sectors are highly correlated. Among them, the excess returns of the truck segment and the logistics sector also exhibit synchronous resonance. Automobile sales, gross margins and industrial policies are important indicators for locking up investment opportunities in the automotive sector.
Valuation: There is still room for improvement in the market value of leading companies. Compared with the automotive industry in the United States, Japan, and South Korea, A-share vehicles have higher PE and PB than other markets, but verticality is historically low compared to history. Judging from the relative valuations of the auto industry and the country's stock market, Shanghai Auto (joining the self-selected stock) is equivalent to Toyota and Hyundai, and Foton Motor (joining the self-selected stock) has a relative market valuation comparable to that of Mann. In terms of market value, Shanghai Automotive’s market capitalization ratio is lower than its revenue share compared to Hyundai’s and Toyota’s.
The impact of gross margin on the valuation is that the trucks are significantly larger than the passenger vehicles segment. The ROE of the current auto sector has fallen from its high point but its historical gross profit rate is at a historically high level.
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