JAC (600418): JAC Volkswagen is expected to open the sequel to Volkswagen Skoda

JAC (600418): JAC Volkswagen is expected to open the sequel to “Volkswagen Skoda”

Company status We studied Jianghuai Automobile on September 11 and communicated with the company.

Comments Light trucks maintain stable profitability, and industry consolidation and progress amplify leading traditional advantages.

The company’s cumulative sales of light trucks this year have reached 130,000 units, every 4 units.

2%, mainly affected by the “large tonnage small standard” incident.

JAC light trucks maintained the second place in the industry’s city share (the market share in January-August was 10.

8%), which is the most important source of profit for the company.

As a traditional light truck leader, Jianghuai is biased towards the mid-to-high-end upgrade route. It is expected to continue to benefit from the high-end trend of light trucks and industry consolidation and clearance, especially to eliminate non-compliant vehicles and car companies after the “large tonnage and small standard” incident.The overall concentration of light trucks has moved up, and the leading advantages have continued to expand.

Passenger car profit pressure is tight, and product layout still needs to be adjusted.

The company’s passenger car sales reached 11 in the first eight months of this year.

40,000 vehicles, a decrease of at least 17%. The sales share of the passenger car segment has fallen from 15 to 16 years to 60% and less than 40%. Due to increasing competition in the industry, the company ‘s main passenger vehicle salesThe downturn and maximum production capacity have resulted in weak profitability of the overall segment.

At the same time, its new energy passenger car iEV series has also suffered from the impact of compensating the decline, and sales have increased in recent months.

We believe that the company still needs to adjust the layout of passenger car products, adjust existing products, dispose of assets and production capacity that drag down profitability, and focus more on the profitable segment.

JAC Volkswagen is expected to become Volkswagen’s cost-effective new energy vehicle manufacturing center.

The first model of JAC Volkswagen ‘s new brand, Sihao, was unveiled last year. Last year, the company also signed a partnership with Volkswagen and Seat Auto to invest in the establishment of a new energy research and development center, which further deepened the cooperation between JAC and Volkswagen.

We believe that JAC, with its cost-effective electric vehicle platform and technology, is expected to become Volkswagen’s cost-effective new 合肥夜网 energy vehicle manufacturing center in China, opening the sequel to “Volkswagen Skoda” in the era of new energy vehicles.

We believe that if there is further cooperation with the public, JAC will also need to prove its strength through market feedback after the launch of the Sihao brand and other products, and be recognized by the public and the market.

Estimates suggest that we temporarily maintain the company’s 2019 and 2020 earnings forecasts unchanged.

The company’s current price corresponds to 44.

3x / 21.

1x 19e / 20e P / E, 0.

8x / 0.

7x 19e / 20e P / B, we maintain the company’s “Neutral” rating and maintain a target price of 5.

61 yuan, corresponding to 47x / 22.

4x 19e / 20e P / E, 0.

8x / 0.

8x 19e / 20e P / B, 6% upside from current price.

Risk cooperation with the public was less than expected, and light truck sales exceeded expectations.