Shanghai Securities·2024-03-28 16:00Investment Rating - The investment rating for BYD is "Buy" (maintained) [4][13]. Core Views - In 2023, BYD achieved a revenue of 602.31 billion yuan, a year-on-year increase of 42.04%, and a net profit attributable to shareholders of 30.04 billion yuan, up 80.72% year-on-year. The fourth quarter alone saw a revenue of 180.04 billion yuan, growing 15.14% year-on-year, with a net profit of 8.67 billion yuan, an increase of 18.64% year-on-year [4]. - The significant growth in 2023 was driven by a 67.69% increase in vehicle sales, with a domestic market share of 31.9%, up 4.8 percentage points year-on-year [4]. - The company improved its profitability with a gross margin of 20.21%, up 3.17 percentage points year-on-year, and an automotive gross margin of 23.02%, up 2.63 percentage points year-on-year [4]. - Despite a 6.14% year-on-year decline in sales in the first two months of 2024, the company remains optimistic about future growth due to new policies and brand strategies [4]. Summary by Sections Financial Performance - In 2023, BYD's revenue was 602.31 billion yuan, with a year-on-year growth of 42.04%. The net profit was 30.04 billion yuan, reflecting an 80.72% increase [4][6]. - The company expects net profits for 2024, 2025, and 2026 to be 37.76 billion yuan, 44.95 billion yuan, and 51.55 billion yuan, respectively, with growth rates of 25.70%, 19.05%, and 14.67% [4][6]. Market Position and Strategy - BYD's vehicle sales surged in 2023, contributing to its strong financial performance. The company aims to leverage new policies and its brand matrix to stimulate future sales growth [4]. - The launch of its first automotive transport roll-on/roll-off ship in January 2024 is expected to enhance overseas sales as the company expands into over 50 international markets [4]. Cost Management and R&D - The overall gross margin for 2023 was 20.21%, with a focus on cost management and efficiency improvements. R&D expenses accounted for 6.57% of revenue, reflecting the company's commitment to innovation [4][6].