Investment Rating - The report assigns a "Buy" rating for the company, marking its first coverage [1]. Core Views - The company is positioned as a leading player in the automotive finance sector, leveraging its technological capabilities to drive growth and innovation [9][14]. - The automotive finance industry in China is expected to continue expanding, with significant growth opportunities due to low penetration rates compared to mature markets [34][40]. - The company's transition from self-operated financing to a transaction platform model is accelerating, with financial technology services becoming a key growth driver [25][61]. Summary by Sections Company Overview - The company, originally part of Yiche.com, has evolved into a major player in automotive finance since its establishment in 2013 and listing in 2017 [14]. - Tencent holds a 53.88% stake in the company, providing strong backing and resources for its growth [16]. - The management team has extensive industry experience, which supports the company's long-term development [19]. Automotive Finance Industry Overview - The automotive finance market in China is projected to reach 6.8 trillion yuan by 2029, driven by increasing consumer demand and regulatory support [37]. - The penetration rate of automotive finance in China is currently at 50.5%, indicating substantial room for growth compared to developed markets [40]. - The competitive landscape includes various players such as commercial banks, automotive finance companies, and internet platforms, each with distinct advantages and challenges [44]. Company Development Highlights - The company's transaction platform business is a strategic focus, with revenue from this segment growing significantly [56]. - Financial technology (SaaS) services have become a major revenue driver, with a 124% year-on-year increase in revenue [61]. - The self-operated financing business has seen a decline in revenue, but asset quality remains stable [67]. Profit Forecast and Investment Recommendations - The company is expected to achieve net profits of 11.26 billion yuan in 2025, with a compound annual growth rate of 39.03% from 2025 to 2027 [1]. - Earnings per share (EPS) are projected to grow from 0.17 yuan in 2025 to 0.26 yuan in 2027, with corresponding price-to-earnings (P/E) ratios decreasing over the same period [1].

Core Insights - E-Chain Group (2858.HK) reported a record high in both revenue and profit for the first half of 2025, with revenue reaching 5.5 billion and net profit at 549 million, marking year-on-year growth of 22% and 34% respectively [1] - Adjusted net profit was 648 million, reflecting a year-on-year increase of 28% [1] Revenue Growth Drivers - The financial technology (SaaS) segment emerged as a key driver for revenue growth, with financing amount increasing by over 58%, accounting for 46.7% of total financing [1] - Revenue from the financial technology segment doubled to 1.9 billion [1] - The used car business represented over 60% of the financing transaction volume [1] Financial Structure Optimization - E-Chain Group optimized its funding structure through asset-backed securities (ABS), syndicated loans, and diversified credit tools, resulting in a significant reduction in financing costs [1]

Investment Rating - The report maintains a "Buy" rating for the company, expecting a relative increase of over 15% in the stock price within the next 6 to 12 months [4][10]. Core Insights - The company has shown strong performance in its used car business, with transaction volume increasing by 31.9% year-on-year, reflecting a strategic focus on high-margin segments [6]. - The financial technology (SaaS) business has also demonstrated significant growth, with financing amounting to 6.1 billion yuan, a year-on-year increase of 56.5%, indicating a successful transition to a tech-enabled platform [6]. - The company is strategically positioning itself in the second-hand electric vehicle market, with the proportion of second-hand electric vehicle transactions rising from 12.5% in 2024 to 23.2% in 2025 [6]. Financial Performance Summary - Revenue projections for the company are as follows: - 2023A: 6,685.97 million yuan - 2024A: 9,887.73 million yuan (growth rate of 47.9%) - 2025E: 11,475.40 million yuan (growth rate of 16.1%) - 2026E: 12,979.49 million yuan (growth rate of 13.1%) - 2027E: 14,547.06 million yuan (growth rate of 12.1%) [4]. - Net profit forecasts are: - 2023A: 554.96 million yuan - 2024A: 809.94 million yuan (growth rate of 45.9%) - 2025E: 1,143.99 million yuan (growth rate of 41.2%) - 2026E: 1,443.70 million yuan (growth rate of 26.2%) - 2027E: 1,794.39 million yuan (growth rate of 24.3%) [4]. - Earnings per share are projected to increase from 0.08 yuan in 2023 to 0.27 yuan in 2027 [4]. Business Strategy and Market Position - The company has effectively optimized its business structure, with the used car segment becoming a core growth driver, now accounting for 60.5% of total transactions [6]. - The report highlights the company's proactive adjustments in product structure and its focus on high-profit used car markets as key factors for its success [6]. - The company has also expanded its partnerships with state-owned banks to enhance its funding channels, further solidifying its market position [6].