In 2002, the rapid growth of the domestic auto industry was reflected in the stock market through the rise in the stock price. The discovery of the value of the auto sector and the continued strength of the stock price signaled the advent of an investment trend in the stock market: the long-term and stable growth of the industry and enterprises. The potential has gradually become the mainstream of institutional investment orientation. At present, the market’s focus on the automotive sector is mainly focused on vehicle companies. The investment value of some listed companies in the auto parts industry is yet to be tapped. Yesterday, universal money tide
The upside down of the relevant stocks, such as Tire Tire, FAW Sihuan, Clutch, Fuyao Glass, etc., indicates that this sector has begun to receive the attention of market funds.
With the rapid growth of the automobile industry, the income from the main business of listed companies in the auto parts industry also showed a significant growth last year. In the first three quarters of last year, the average main income of the auto parts sector reached 96.50% in 2001, and it is expected to achieve an annual growth of approximately 20%. In 2001, about 40% of the listed company’s profits declined, but in the first three quarters of 2002, all of them achieved growth. Most of the companies saw a significant increase. A group of FAW Sihuan, Weifu Hi-Tech, and Yunnei Power, etc. All of the companies with clear industry have achieved continuous growth for several years.
However, compared with the whole vehicle, the profit growth potential of the accessory industry is relatively small, and the net profit of the accessories sector is not synchronized with the growth of the main business income. This phenomenon occurred in 2000, when the average income of the main business of the sector increased. It is 13.61%, while the net profit growth is only 1.63%. In the first three quarters of the previous year, the average net profit of the accessories sector reached 83.42% of the whole year of 2001. It is expected that the annual growth rate should not exceed 5%. The essence of this phenomenon lies in the intensification of deep competition after China's entry into the WTO. OEMs require suppliers of accessories to continuously reduce costs in order to shift the cost pressure brought about by the price drop. At the same time, the increase in import quotas and the participation of joint venture multinational companies in order to obtain profits on parts and components, a large number of imported auto parts, resulting in imported parts impact on domestic parts manufacturers. In the accessory maintenance market, due to the large number of companies participating in competition, low-level price competition is the main means of competition, forcing profit growth cannot be synchronized with income growth. The automobile domestication policy no longer requires that “automotive industry enterprises must not import spare parts and assembly production by semi-parts and all parts,†and cancels the preferential tax rate for auto products to reach the localization rate standard, and global procurement of parts and components becomes the entire vehicle. An important means for companies to improve product quality or reduce costs. In the first 10 months of 2002, the country’s imports of automotive products totaled 6.26 billion U.S. dollars, of which 100,000 were imported by autos, totaling 2.55 billion U.S. dollars, and auto parts imports were 3.72 billion U.S. dollars. Auto parts occupy a major position in imports. It is expected that in 2003, import quotas for auto parts will increase significantly, and the impact on domestic parts will also increase.
Of course, the increase in domestic vehicle ownership has determined that auto parts manufacturers are facing major development opportunities. Those who can grasp the opportunities will be those companies that already have a competitive advantage. The listed companies of auto parts will continue to differentiate, and the competitive enterprises will obtain the opportunity of global procurement of accessories and achieve continuous growth. Correspondingly, enterprises that are at a disadvantage in competition will face transformation and elimination, but there are also opportunities for reorganization of assets.
Among the listed companies in the sector, the top five companies with the highest profitability in the first three quarters of 2002 were Fuyao Glass, Dongfeng Technology, FAW Sihuan, Weifu Hi-tech and Wanxiang Qianchao. Among them, Fuyao Glass is the largest automotive special glass supplier in China. The product has a certain brand effect in the domestic market, can provide support for a number of vehicle companies, has a high net profit rate, and since 1999, the company has been successful. Into the North American spare parts maintenance market, but due to anti-dumping investigations, whether a successful case will have a great impact on the future development of the company. Dongfeng Technology and FAW Sihuan rely on strong Dongfeng Motor and FAW Group, respectively. Stable product demand is conducive to the company maintaining a high level of profitability. According to the agreement between Dongfeng and Nissan, Nissan will help parts and components manufacturers including Dongfeng Technology to improve quality, reduce costs, and eventually incorporate these companies into Nissan's global parts procurement system. The prospect of Dongfeng Technology is expected. Weifu's high-tech and product quality leadership has established a monopoly position in the oil pump nozzle market. Wanxiang Qianchao is a well-known private enterprise in China and the largest auto parts production base in China. The value of the above companies still has potential for further exploration and is worth the attention of the long-term investors.
Tire manufacturers in the automotive-related industries are suffering from the dual pressure of intensified competition in the product market and the double rise in raw material prices, and it is expected that the international rubber price rise is far from over. This year's performance expectations are not optimistic, but this intensified the assets of listed companies. The sense of urgency in reorganization, and the high risks also contain opportunities.