GAC GROUP(SH:601238) EBSCN·2024-09-02 14:07Investment Rating - The report maintains an "Add" rating for A-shares and adjusts the H-shares rating to "Add" [1][2] Core Views - GAC Group is experiencing performance pressure during its transformation phase, necessitating urgent joint venture transitions [1] - The company's revenue for 1H24 decreased by 25.6% year-on-year to CNY 45.81 billion, with a net profit attributable to shareholders down 48.9% to CNY 1.52 billion [1] - The report highlights a significant decline in investment income from joint ventures, with a 58.8% year-on-year drop to CNY 2.01 billion in 1H24 [2] Summary by Sections Market Data - Total share capital: 10.392 billion shares - Total market value: CNY 76.897 billion - 1-year price range: CNY 7.09 to CNY 10.50 - Recent turnover rate: 11.83% [1] Company Performance - 1H24 revenue: CNY 45.81 billion, down 25.6% YoY - 2Q24 revenue: CNY 24.46 billion, down 30.5% YoY but up 14.6% QoQ - 1H24 net profit: CNY 1.52 billion, down 48.9% YoY - 2Q24 net profit: CNY 0.3 billion, down 79.3% YoY and 75.7% QoQ - 1H24 net loss after adjustments: CNY 0.34 billion [1][2] Joint Venture and Transformation - Investment income from joint ventures fell by 58.8% YoY to CNY 2.01 billion in 1H24 - GAC Honda's sales dropped by 28.3% YoY to 208,000 units, while GAC Toyota's sales decreased by 25.8% YoY to 336,000 units [1][2] - GAC Honda is advancing its electrification strategy, planning to launch six new electric models by 2027 [1] - GAC Toyota is focusing on self-research in electrification and smart collaboration, particularly in solid-state battery technology [1] Sales and Export Performance - GAC Trumpchi's sales increased by 0.4% YoY to 189,000 units in 1H24 - GAC Aion's sales decreased by 39.7% YoY to 126,000 units, but overseas sales surged by 190% YoY to 68,000 units [2] - The company aims to accelerate the development and production of six overseas products in 2H24 to achieve a sales target of over 150,000 units for the year [2]