Huayu Automobile: steady growth in performance

Third-quarter earnings were in line with market expectations. The single-quarter operating income of the company in the third quarter was RMB 134.47 billion, up 23.2% year-on-year, and achieved net profit attributable to the parent company of RMB 738 million, a year-on-year increase of 15.2%, and an EPS of RMB 0.29; In the quarter, the company's operating income was 39.48 billion yuan, an increase of 23.61% year-on-year; and the net profit attributable to shareholders of the parent company was 2.291 billion yuan, a year-on-year increase of 20.28%.

The steady development of the company is mainly due to the strong sales of SAIC (Shanghai Volkswagen, Shanghai GM) automobile sales since 2011, the rapid growth of the domestic passenger car market and the increasingly fierce competition in the auto parts industry is obvious, and then the company firmly Grasping the rapid growth of market opportunities for passenger cars in Europe and the United States, through the adjustment of product structure, improving production efficiency, ensuring timely supply, and deepening cost reduction and efficiency improvement, we will go all out to develop new markets and continue to meet customer needs. Maintain healthy and steady development.

Gross profit margin has increased During the reporting period, the gross profit margin of the company was about 16.3%, which was a slight increase from the same period of last year and the second quarter of this year. On the one hand, it is due to the company's improvement of production efficiency and the deepening of cost reduction and efficiency enhancement. On the other hand, as a component supporting company of SAIC Motor, it has adjusted its product structure appropriately and quickly around SAIC Motor's products, thus achieving cost savings.

The three expenses increased year-on-year to varying degrees, but the share of revenue fell in the third quarter of a single quarter, the company’s sales expenses increased 7.54% year-on-year, the management expenses increased by 15% year-on-year, and the financial expenses also increased, but the three expenses combined accounted for the current period revenue only. It was 7.9%, down 0.77 percentage point from the same period of last year.

The performance of the investment proposal and rating for the first three quarters is enough to prove that the company's development trend is relatively stable. We expect the company's earnings per share for 2011-2013 to be 1.16 yuan, 1.37 yuan and 1.63 yuan, respectively, corresponding to a dynamic price-earnings ratio of 8.8 times, 7.46 times and 6.27 respectively. Times, give a "buy" rating.

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Chongqing Huanyu Automobile Sales Company , https://www.huanyuauto.com