Summary of Yongda (3669.HK) Conference Call Company Overview - Company: Yongda (3669.HK) - Industry: Automotive Dealerships, focusing on premium brands including BMW and Porsche [doc id='28'] Key Points Huawei Dealership Expansion - Management expects to open more than 10 Huawei-authorized stores by December 2024, with a target of 20-30 stores by the first half of 2025 [doc id='3'][doc id='4'] - 30-40 existing stores will be converted into Huawei-authorized stores throughout 2025, with 70% of these conversions coming from BBA dealerships [doc id='3'][doc id='25'] - The cost for converting a traditional BBA dealership into a Huawei store is approximately RMB 1 million per store, with a projected first-year ROI exceeding 10% [doc id='3'][doc id='20'] Sales Performance - FY24E sales volume for Huawei-related new cars is projected to reach 7-8k units, representing over 100% year-on-year growth [doc id='5'] - The gross profit margin (GPM) for new car sales remains stable at 4.5%, with additional contributions from delivery commissions and cross-sales services [doc id='5'] - The average net profit per shop for Huawei dealerships with an annual sales volume of 2k units is expected to exceed RMB 10 million [doc id='17'] After-Sales Revenue Growth - FY24E after-sales revenue is expected to grow 2.5 times year-on-year, with a notable 9.8% monthly compound growth rate from January to October 2024 [doc id='6'] - Average after-sales GPM is around 42%, which is higher than traditional luxury internal combustion engine (ICE) vehicles [doc id='6'] Partnerships with Other NEV Brands - Partnerships with brands like XPeng and Nio are yielding positive results, with XPeng models generating deep order backlogs and Nio's after-sales service center achieving 70% month-on-month revenue growth in its first three months [doc id='7'] Financial Performance - The company reported a net profit of RMB 573 million for 2023, down 59% from the previous year, with projections of RMB 316 million for 2024 and RMB 691 million for 2025 [doc id='10'] - The expected total return for Yongda shares is 60.5%, with a target price of HK1.95 [doc id='8'][doc id='30'] Risks and Challenges - Key risks include lower-than-expected revenues and gross profit margins for the passenger vehicle and after-sales businesses, as well as potential setbacks in the development of car rental and auto finance businesses [doc id='31] - Management expects the GPM for new car sales in the second half of 2024 to remain flat due to ongoing pricing pressures [doc id='15'] Market Outlook - Used car sales are projected to decline by 20% year-on-year to 80k units in FY24E, but are expected to grow by 21% in FY25E assuming price stabilization [doc id='16] - Management anticipates that Huawei's after-sales network will be fully established by the end of 2025, aiming for a service capacity comparable to major luxury brands [doc id='19] Conclusion Yongda is positioning itself for significant growth through its partnership with Huawei and expansion of its dealership network. Despite facing challenges in the used car market and pricing pressures, the company's strategic initiatives and partnerships are expected to drive future profitability and market share.
Yongda (3669.HK)_ Huawei Dealer NP_Shop and ROIC Updates
36氪研究院·2024-11-26 06:25