SAIC Group (600104) 2019 Interim Report Comments: Q2 performance short-term pressure does not mask long-term competition

SAIC Group (600104) 2019 Interim Report Comments: Q2 performance short-term pressure does not mask long-term competition

Core point of view The company’s operating income in the second quarter of 2019 was 176.1 billion yuan, about -22.

0%.

Q2 deducted non-attribution net profit increased by 42%, which was 35 instead of the previous month.

7%, short-term performance was under pressure, mainly due to the impact of the previous quarter to promote the emission of inventory vehicles in China.

The company has a solid balance sheet and abundant new energy model reserves. Short-term pressure will not affect the company’s long-term competition and maintain a “buy” rating.

   Q2 deducted non-homing net profit decreased by 42%, mainly due to the second quarter of major promotions to go to China V emissions inventory vehicles.

The company achieved operating income of US $ 176.1 billion in the second quarter of 2019 (two years-22).

0%, MoM-12.

0%), achieving net profit of 55.

10,000 yuan (ten years -40.

6%, -33.

2%), net profit after deduction is 48.

90,000 yuan (-42 for the whole year.

0%, -35.

7%).

The company’s 苏州桑拿网 non-net profit growth rate in the second quarter was higher than the previous quarter’s -13.

9% formaldehyde to -42.

0%, mainly due to the impact of emissions upgrades, major promotions in the second quarter of the impact of going to China V emissions inventory vehicles.

The gross profit margin of the company’s consolidated statement caliber remained at 14.

6%, the same as last year.

The total of the company’s four expenses (finance + management + sales + research and development) is 220.

400 million, an increase of 4 from Q1.

At the same time, the company’s Q2 gross profit totaled 256.

700 million, down 34 from Q1.

300 million yuan.

   Affected by the promotion of the five-stock emissions-promoting stock cars in the first half of the year, the profitability of the joint venture company decreased significantly.

In 武汉夜网论坛 terms of joint ventures, SAIC Volkswagen, SAIC-GM and SAIC-GM-Wuling achieved net profit of 98 respectively.

8 billion / 71.

100 million / 8.

400000000.

In terms of bicycle data, SAIC Volkswagen’s bicycle revenue was 12 in the first half of the year.

270,000 yuan (ten years -10.

2%), bicycle profit 1.

08 thousand yuan (at least -29.

1%), net interest rate 8.

8% (18H1 / 18H2 are 11 respectively.

1% and 10.

5%).SAIC-GM’s Bicycle Revenue10.

960,000 yuan (year -6.

2%), bicycle profit is 0.

850,000 yuan (at least -20.

3%), net interest rate 7.

8% (18H1 / 18H2 are 9 respectively.

2% and 4.

8%).

Wuling Bicycle Revenue 4.

920,000 yuan (ten years +0.

4%), bicycle profit is 0.

110,000 yuan (-41 for the whole year.

7%), net interest rate 2.

3% (18H1 / 18H2 are 4 respectively.

0% and 4.

3%).

   SAIC’s financial profitability improved, and independent brands remained under pressure.

SAIC Finance achieved net profit in the first half of 201928.

800 million, +2 per year.

3%, is the only subsidiary of SAIC’s five major ginseng holding companies to achieve profitable growth. It is expected that the increase in the popularity of automobile finance in the future will continue to contribute to SAIC Finance’s profit increase.

According to the parent company’s statement, SAIC’s independent brands corrected a total of 18 in Q2 2019.

0 ppm (parent company’s net profit-investment income), 5 before 19Q1
.

0 million US dollars expanded sequentially.

However, in the long run, the company has abundant reserves of its own brand models, and its new energy layout industry is leading. It will continue to expand its market share in the medium and long term.

   Risk factors: Macroeconomic growth eventually leads to less-than-expected sales; new model market acceptance gradually exceeds expectations; the growth rate of independent brands continues to increase.

   Investment suggestion: Considering that the industry’s business climate is at a low level, and the industry’s sharp promotion in the second quarter erodes earnings, we lower the company’s 2019/20/2021 earnings per share forecast to 2.

57/2.

79/2.

95 yuan (previous forecast was 3).

14/3.

36/3.

47 yuan).

The current price is 24.

72 yuan, corresponding to 9/2019/20/21.

6/8.

9/8.

4 times PE.

The company has a solid balance sheet and abundant reserves of new energy tools; the allocation rate still provides a sufficient margin of safety; it continues to be recommended as a long-term leader and maintains a “buy” rating.