BYD (002594) comment on major issues: forecast of joint venture Toyota electric technology output
The company announced an agreement with Toyota Motor on a joint venture to establish a pure electric vehicle research and development company on November 7, 2019.
BYD and Toyota will each hold 50% of the joint venture.
The joint venture company will be jointly formed 杭州夜网论坛 by personnel from the military-related businesses of both parties, mainly to do 1) the design and development of pure electric vehicles and their derivative vehicles and related parts, and 2) the development of pure electric vehicles and their derivative parts, components and assembliesExport and sales.
Comment: Understand this joint venture, the key 3 points: 1) Joint venture to establish a research and development company, not involving production.
It can be understood as the pure electric car research institute of Toyota (and BYD). In the future, Toyota will introduce the production to existing OEMs according to Toyota’s shift. At the same time, it will also be a channel supplier for parts supply.
2) For Toyota, the (more like) co-sponsor will use BYD’s core electric technology and component assemblies to rapidly 杭州夜网论坛 enhance the development and mass production of pure electric vehicles.
We predict that the first car will be unveiled around 2022 in about 3 years.
But through the joint venture, we can see that Toyota’s attitude towards mastering the core technology of pure electricity is not firm.
3) For BYD, the important premise of technology export is more significant than simply supplying external parts.
Auto companies have established a joint venture with key component manufacturers to achieve stable supply and mutual benefit.
In addition, BYD also has the opportunity to further improve BYD’s car control quality and safety capabilities through joint ventures, and to a certain extent avoid foreign attitudes and China’s ability base and cooperation mechanism design.
Another company overseas that achieves pure electric technology output is Volkswagen authorized Ford to use the MEB platform, but there is no joint venture.
Affected by subsidies and bases, the company’s current sales of electric vehicles are flat.
BYD wholesale in October total 4.
10,000 vehicles, -18% a year, + 6% from the previous month.
Among them are new energy passenger cars1.
20,000 vehicles, at least -57%, + 21% MoM.
Affected by the decline in subsidies and the increase in the base, the decline in new energy vehicles has increased month by month (July to September: -3%, -15%, -34%).
The new Qin EV is on the market this week, with a guide price drop of 20,000 to 12.
Starting at 990,000, the battery capacity is reduced by 7 degrees and the mileage is increased by 21km.
Fuel passenger car 2.
90,000 vehicles, + 37% a year, + 2% MoM.
Among them Song Pro 1.
60,000 vehicles, + 32% month-on-month, maintaining a hot sales trend.
The improved data is expected to reflect the launch of new models with stronger cost performance.
Investment suggestion: This time, a joint venture with Toyota to establish a research and development company to further confirm BYD’s outstanding advantages in the field of electric power, technology output + key high barriers parts supplier attributes enhanced.
We maintain the company’s expected net profit attributable to mothers for 2019-2021.
200 million, 24.
3 billion, 44.
200 million, corresponding to a growth rate of -38%, + 42%, + 82%.
The company’s performance in the past two years has been affected by the subsidy policy, but the company’s leading scale of electric vehicles has continued to expand, and the impact of substitution changes will gradually come to an end in history. The company’s new technologies and models in 2020 are expected to boost demand and performance.Realize the strong expansion of the external supply of Sanden Technology, and maintain the company’s 2020 target PB 2 based on the above factors.
7 times, corresponding to the target price of 55.
1 yuan, corresponding to 2019-2020 PB 2.
8 times, 2.
7 times, PE is 87 times, 62 times.
Maintain the “Recommended” level.
Risk warning: demand for electric vehicles exceeds expectations, battery cost reduction rate exceeds expectations, and electric vehicle policies fluctuate.