SAIC Group (600104): Industry Leads Long-Term Layout to Meet Recovery

The event company released the June 2019 production and sales report: the group achieved 470,000 car sales, -16% per year.

  Among them, SAIC Motor sold 50,000 passenger cars, -11% a year; SAIC Volkswagen sold 150,000 cars, -13% each time; SAIC GM sold 140,000 cars, each time unchanged; SAIC-GM-Wuling sold 100,000 units,-36% each time.

  The Group sold 2.94 million vehicles in the first half of 2019, -17% per year.

  At the same time, the company announced the implementation of the 2018 annual equity distribution announcement. The equity registration date is July 11, 2019, and the ex-rights date and cash dividend 重庆耍耍网 issuance date are July 12. In the case of natural person shareholders and securities investment funds, cash is actually actually distributedDividend RMB 1.

26 yuan, corresponding to an index rate of 4.

7%.

  Opinions National Five took the initiative to go to the end of the warehouse expansion, National Six penetration gradually increased, in order to meet the “Golden Nine Silver Ten” industry peak season group wholesale is expected to repair the rebound in the next few months.

  [Joint venture brand]SAIC Volkswagen’s monthly wholesale data fell by 13%, mainly due to the location of sedan data. Polo / Passat / Skoda Octavius were separated by -68% /-32% /-53%, respectively.Yue / Tao Ang together contributed 4.

50,000 vehicles.

SAIC-GM ‘s single-month excess data has seen an increase in repairs. The replacement cycle of first- and second-tier cities drives consumption upgrades. The luxury brand Cadillac maintains more than 20,000 monthly wholesales.

SAIC-GM-Wuling’s monthly wholesale is still affected by the upgrade of engine emissions, and it has continued to complete the dumping of National V inventory. National VI is expected to gradually increase its penetration rate on July 1.

  [Independent Brands]SAIC Passenger Cars are stable and stable in the overall economic downturn, and their technology and product reserves are still ahead in the autonomous sector.

SAIC passenger cars maintained more than 50,000 in June, and the penetration rate of electric vehicles is expected to continue to increase.

Despite the rapid growth, SAIC has independently grasped the key layouts in core technologies: 1) In the electric field, the company’s new round of “Sandian” core technology innovation and the development of new electric vehicle exclusive architecture continue to advance, and work together with InfineonIGBT products were delivered in batches, and the fuel cell (SAIC 300) trial production test power has reached the world’s leading level; 2) In the intelligent field, we have deepened cross-border cooperation with industry giants such as Alibaba, Mobileye, China Mobile, and Huawei.

We believe that the auto consumption policy will be boosted in the second half of 2019, alternating the factors of base replacement in the second half of 2018. The industry is expected to usher in an inflection point and drive the flexibility of independent sales.

  Investment suggestion The industry’s low-level industrial chain accelerates the clearing of outdated products, brands and production capacity, and the leading passenger cars benefit for a long time.

  The second half of 2019 is optimistic about the industry’s destocking in two years or so, which will lead to severe switch-offs after capacity reduction. The thrust of the expansion of the faucet will reach a larger industry increase.The vehicle sector’s risk expectations continue to increase, and we give SAIC, the leader in passenger cars, a premium of 10 times PE.

Profit forecast: It is estimated that the company’s net profit attributable to the parent from 2019 to 2021 will be 372/399/430 trillion, and the EPS will be 3 respectively.

18/3.

41/3.

68 yuan, corresponding to PE 8.

4/7.

9/7.

3 times.

The 10x target PE corresponds to the company’s target price of 31.

80 yuan, upgrade from “overweight” to “buy”.

  Risk reminder: downside risks to the auto market; sales of old models fail to meet expectations; new models are not listed as expected.