People's Daily Online, Beijing, December 19th, Beijing Automobile Co., Ltd. (hereinafter referred to as BAIC, stock code: 1958.HK) will be officially listed on the Hong Kong Stock Exchange. According to the prospectus, BAIC has successfully introduced 10 cornerstone investors with a subscription amount of US$786 million, accounting for 56.5% of the number of global offering shares. Curtain Wall,Aluminium 150 Curtain Wall,Powder Coated Curtain Wall,Anodized Curtain Wall Profile FOSHAN WINKAI ALUMINIUM CO.,LTD , https://www.winkaialu.com
"From the perspective of the IPO, BAIC has a very high investment value in the eyes of investors," said East Asia Securities analyst Paul Sham.
As a leading company in the mainland car companies, BAIC is the platform for the integration and business development of the vehicle resources of the BAIC Group, and is also the development sector of the Beijing Municipal Government's key industries. Independent stock critics Chen Yonglu said that the listing of BAIC shares in Hong Kong, the market response is enthusiastic, a factor that cannot be ignored is that investors are highly optimistic about the shareholders of BAIC.
BAIC's business is operated through three major segments: Mercedes-Benz luxury car, Beijing Hyundai mid- to high-end brand car and Beijing Auto's own brand passenger car. Through the market segmentation strategy, the passenger car brand portfolio is diversified. This segmented product portfolio effectively reduces the operational risks that a single market may bring, thus ensuring the profitability of BAIC.
According to the prospectus, from 2011 to 2013, China's passenger car sales compound growth rate was 15.7%, while BAIC's own brand, Beijing Benz and Beijing Hyundai in 2011, 2012 and 2013, the total sales of passenger cars were 860,000, 10.4 million and 13.5 million, with a compound annual growth rate of 25.4%, far higher than the national average.
“Beijing Benz is a joint venture between BAIC and Daimler. The joint venture period is from 50 to 2033. BAIC holds 51% of Beijing Benz, which is the only manufacturer of Mercedes-Benz brand in China. Müller’s first engine plant outside Germany helped the company’s business relationship with Daimler to continue to grow,†said Lian Chenghan, director of research at Fu Cheong Financial Group and director of the Hong Kong Equity Analyst Association (IFAPC). In addition, based on individual brand sales in 2013, Beijing Hyundai is China's second largest joint venture passenger car brand, with an annual sales volume of more than 1 million units in 2013 alone. Benefiting from its joint venture as the only manufacturer of modern branded passenger vehicles in the Mainland, its production scale far exceeds that of most other joint ventures that need to share the same brand of products with another Chinese automaker.
At the same time, Anxin International Securities Research said that in addition to its own advantages, the overall environment of the Chinese economy is also boosting the Chinese passenger vehicle market. For example, the urbanization process has accelerated the huge business opportunities brought by passenger cars; the strong investment and construction of transportation infrastructure have led to a surge in demand for automobiles in China; the rapid growth of economic and disposable income has driven the increase in demand for passenger cars and related products.
According to statistics from Beijing Huatongren Commercial Information Co., Ltd., China's passenger car market is currently the largest in the world, but the proportion of passenger car ownership relative to the population (passenger car penetration rate) is still low, only 7.2 in 2013. %. Compared with other developed countries, such as 59.5% in Australia, 56.6% in Germany, and 48.2% in Asia and Japan and 31.2% in South Korea, the future development of China's passenger car market is huge.
According to analysis by Pan Chenyi, an analyst at GF Securities, BAIC's 2015 P/E ratio is 6.4 to 8.3 times. The valuation is reasonable. After the listing, it will become the second largest passenger car manufacturer in Hong Kong. Lian Jinghan believes that BAIC has a certain leading concept and can subscribe in cash.