Core Viewpoint - BYD has achieved record monthly sales in its electric vehicle division, demonstrating strong growth despite market challenges, and is considered undervalued compared to its peers in the EV industry [1][2][11] Sales Performance - In August, BYD sold 373,083 new electric vehicles, marking a year-over-year growth rate of 36% and surpassing its previous sales record from July by over 30,000 units [3] - BYD's new energy vehicle sales have shown a consistent uptrend since March, indicating effective scaling of production and potential for future sales records [4] Competitive Landscape - Other EV manufacturers like NIO, XPeng, and Li Auto also reported deliveries in August, with NIO delivering 20,176 vehicles (4% growth), XPeng delivering 14,036 vehicles (3% growth), and Li Auto delivering 48,122 vehicles (38% growth) [5] - BYD's international sales reached 31,451 vehicles in August, reflecting a year-over-year growth rate of 26% [5] Profitability and Margins - BYD achieved gross profit margins of 19% in Q2 2024, which is approximately 1 percentage point higher than Tesla's margins, positioning it as a strong player in terms of profitability [6] - The company has the second-highest gross margins in its industry group, following Li Auto [6] Valuation Metrics - BYD is currently valued at a forward price-to-earnings ratio of 16.0X and a price-to-revenue ratio of 0.73X, significantly below the industry average of 1.92X [8] - The company is projected to achieve a total revenue volume of $123.4 billion in FY 2025, with a fair value price-to-revenue ratio estimated at 2.0X, suggesting a target share price of $85 [8][9] Market Outlook - BYD's growth strategy execution and competitive margins make it an attractive investment option, especially as it is expected to surpass Tesla in total revenue volume next year [8][11]
BYD: Record Sales, Low Valuation