SAIC Group’s (600104) Half-yearly Report in 2019 Commentary: Low Industry Demand Overlays Switchover of China’s Five Countries and Six Countries Puts Pressure on Company Performance

SAIC Group’s (600104) Half-yearly Report in 2019 Commentary: Low Industry Demand Overlays Switchover of China’s Five Countries and Six Countries Puts Pressure on Company Performance

Event: The company recently released the semi-annual report for 2019: the company’s revenue in 2019H1 was about 3762.

900 million, net profit attributable to mother is about 137.

6 trillion, a year -27.

5%.

The comments are as follows: The company’s net profit attributable to motherhood in 2019H1 is approximately 137.

6 trillion, a year -27.

5%: The net profit attributable to mothers in Q2 2019 is approximately 55.

1 ‰, about -40 a year.

6%, before the decline in 2019Q1 expanded (2019Q1 exceeded -15.

0%).

On July 1, 2019, the implementation of National VI emissions in most regions of the country led most auto companies to increase discounts to clear up National V inventory in Q2 2019. The average value of auto companies affiliated to 2019H1 companies has changed significantly: SAIC Volkswagen achieved revenue of 1127 in 2019H1.

9 ‰, at least -19.

1%, net profit attributable to mother is about 98.

800 million, ten 苏州桑拿网 years -36.

1%: SAIC Volkswagen achieved sales of 91 in 2019H1.

90,000, at least -9.

9%; average bicycle price is about 12.

30,000 yuan, lower than 13 in 2018H1.

70,000 yuan; net sales margin is 8.

8%, down from 11 in 2018H1.

1%, the increase in profitability led to its net profit growth and expected earnings growth.

  SAIC-GM-2019H1 achieved revenue of about 913.

8 ‰, at least -18.

3%, net profit attributable to mother is 71.

10,000 yuan, at least -30.

6%: SAIC-GM achieved sales of 83 in 2019H1.

40,000, at least -12.

9%; average bike price is about 11.

10,000 yuan, lower than 11 in 2018H1.

70,000 yuan; net sales margin is 7.
.

8%, lower than 9 in 2018H1.

2%.

  Shanghai Tongwu’s 2019H1 revenue was 366.

2 trillion, one year -28.

9%, net profit attributable to mother is 8.

43 trillion, one year -58.

7%: The sales volume of Shanghai Tongwu 2019H1 is about 74.
40,000, at least -29.
2%, 2019H1 its net interest rate is 2.

3%, down from 4% in 2018H1.

  The 2019H1 auto financial sector has better performance, reduced hedging manufacturing end, and weaker parts business: SAIC Finance achieved revenue of 87 in 2019H1.

700 million, 9 per year.

5%, net profit attributable to mother is 28.

800 million every year 2.

3%.

Huayu Auto’s 2019H1 achieved revenue of 705.

6 ‰, at least -13.

6%, net profit attributable to mother 33.

600 million, -29 per year.

5%.

  In 2019Q2, the profit margins of OEMs will be lower due to the clearance of the National Five, and we believe that it is only a short-term pain in the industry. With the implementation of National Six in 2019H2, car prices will recover, and automobile demand will continue to recover.

We appropriately lower our profit forecast for 2019-2021: EPS is 2 respectively.

42 yuan, 2.

81 yuan and 2.

95 yuan, corresponding PE is 10X, 9X and 8X respectively, maintaining the “recommended” level risk warning: the automotive market boom continues to decline, new model sales are less than expected