德银-港股-汽车与汽车零部件行业-汽车零部件行业要点：强劲势头继续-20171201-16页_1000kb
报告摘要
Auto Parts Sector Analysis - 1 December 2017
Core Content Overview
The document presents an analysis of the China auto parts sector with a focus on several key companies: Minth Group Limited, Nexteer Automotive Group Li, Tuopu, and Huayu Automotive, as well as NavInfo Co., Ltd.. The analysis is conducted by Deutsche Bank and highlights the robust momentum in the auto parts industry for 4Q17-2018E. The report also discusses earnings forecasts, target price adjustments, and key risks for each company.
Main Companies and Key Insights
Minth Group Limited (0425.HK)
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Key Highlights:
- Revenue from aluminum products increased in 2H17, reaching $23 - 24%$ of total revenue.
- New orders reached RMB4.5bn for the full year, with a secure order backlog of RMB86.5bn.
- Management maintained revenue and margin guidance, with gross margin improvements at Mexico and Huai'an plants.
- Raw material price fluctuations are expected to have minimal impact on margins, less than 1ppt.
- Utilization rates at domestic plants are $75 - 85%$, with higher rates in the US and lower in Thailand and Mexico.
- Target price increased to HKD47.60 from HKD44.40.
- Valuation based on 18x FY18E P/E, reflecting strong growth in aluminum products.
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Key Risks:
- Weaker-than-expected auto sales.
- Failure to acquire new customers.
- Market share loss at existing clients.
- Unexpected increases in raw material prices.
Nexteer Automotive Group Li (1316.HK)
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Key Highlights:
- Maintained FY17 revenue forecast and slightly raised FY18-19 revenue forecasts by $0.1 - 0.9%$.
- Net profit growth expected at $22.6%$ in FY17, followed by $14.4%$ and $11.9%$ in FY18 and FY19.
- Target price raised to HKD19.10 from HKD17.06.
- Valuation based on 15x FY18E P/E, 50% above its mid-cycle P/E, reflecting strong development in ADAS-featured products.
- Expected 16.2% three-year EPS CAGR in FY16-19.
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Key Risks:
- Weaker-than-expected China and US auto production.
- Dependent relationship with GM.
- Inability to gain new customers.
- Market share loss at Nexteer's clients.
- Unexpected increase in raw material prices.
Tuopu (601689.SS)
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Key Highlights:
- 3Q17 margin weakness attributed to environmental checks and rising raw material prices.
- Expected to return to normal in 4Q17, with strong volume growth due to Geely's sales.
- Revenue from Geely was RMB760m in 2016, expected to double in 2017.
- IBS product will start mass production by end of 2018, with an ASP of RMB1,800-2,000.
- Target price increased to CNY31.50 from CNY24.90.
- Valuation based on 25x FY18E P/E, slightly below its mid-cycle P/E, reflecting growth in IBS and EVP.
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Key Risks:
- Weaker-than-expected auto sales.
- Failure to obtain new order awards for IBS/EVP.
- Market share loss at key customers.
- Unexpected increases in raw material prices.
Huayu Automotive (600741.SS)
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Key Highlights:
- Maintained FY17E revenue and slightly raised FY18-19 revenue forecast by $0.9 - 1.3%$.
- Raised net profit forecast by $3.5 - 5.4%$ due to better margin assumptions.
- Target price increased to CNY30.80 from CNY27.48.
- Valuation based on 13x FY18E P/E, above mid-cycle P/E of 8x.
- Expected 14.7% three-year net profit CAGR in FY16-19.
- Overseas sales growth and acquisition of auto lamp business provide additional growth drivers.
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Key Risks:
- Weaker-than-expected auto sales.
- Inability to acquire new customers.
- Market share loss.
- Unexpected increases in raw material prices.
NavInfo Co., Ltd. (002405.SZ)
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Key Highlights:
- Leading China mapping service provider with HD mapping applications for autonomous driving.
- Strategic cooperation with HERE, resulting in mapping service contracts with major German OEMs.
- Jiefa fully integrated, with a focus on developing ADAS chips.
- Gross profit margin (excluding Jiefa) at $90%$, but most costs are in operating expenses.
- Revenue stream expected to include licensing, continuous service, and big data sales.
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Key Risks:
- Weaker-than-expected auto sales.
- Failure to launch ADAS chips in the near term.
- Termination of investment in Europe's HERE due to regulatory issues.
Key Changes in Target Prices
| Company | Target Price | Rating |
|---|---|---|
| 0425.HK | HKD 47.60 | Buy |
| 1316.HK | HKD 19.10 | Buy |
| 601689.SS | CNY 31.50 | Buy |
| 600741.SS | CNY 30.80 | Buy |
Key Financial Metrics (Selected)
Minth Group Limited (0425.HK)
- P/E (DB): 11.0 to 20.8
- P/BV: 1.61 to 3.57
- FCF Yield: nm to 4.7%
- Dividend Yield: 1.8% to 2.9%
- EV/Sales: 0.7 to 1.3
- EV/EBITDA: 6.1 to 8.2
- EV/EBIT: 9.1 to 11.2
Nexteer Automotive Group Li (1316.HK)
- P/E (DB): 9.4 to 15.2
- P/BV: 2.80 to 4.02
- FCF Yield: nm to 5.5%
- Dividend Yield: 1.8% to 1.7%
- EV/Sales: 0.7 to 1.3
- EV/EBITDA: 5.0 to 8.2
- EV/EBIT: 7.0 to 11.2
Tuopu (601689.SS)
- P/E (DB): 28.0 to 19.8
- P/BV: 153.0 to 102.9
- FCF Yield: nm to 4.7%
- Dividend Yield: 3.2% to 2.4%
- EV/Sales: 1.7 to 2.9
- EV/EBITDA: 8.7 to 12.0
- EV/EBIT: 11.0 to 14.7
Huayu Automotive (600741.SS)
- P/E (DB): 8.4 to 11.6
- P/BV: 153.0 to 102.9
- FCF Yield: nm to 4.7%
- Dividend Yield: 3.7% to 2.4%
- EV/Sales: 1.7 to 2.9
- EV/EBITDA: 8.7 to 12.0
- EV/EBIT: 11.0 to 14.7
Summary of Key Trends
- Growth Momentum: The auto parts sector in China is showing robust growth, with companies like Minth, Nexteer, Tuopu, and Huayu maintaining or increasing their revenue and profit forecasts.
- Margin Improvements: Companies are seeing improvements in gross margins, with some attributing this to better product mix and operational efficiency.
- New Orders and Backlogs: Strong new order intakes and secure backlogs are driving positive outlooks, particularly for Minth and Nexteer.
- Strategic Initiatives: Investments in new products such as IBS and EVP, as well as expansion into active safety systems, are key growth drivers.
- Valuation Adjustments: Deutsche Bank has raised valuation multiples for several companies, reflecting increased confidence in their growth potential.
- Risks: The primary risks include weaker auto sales, raw material price volatility, and dependency on major OEMs like GM and Geely.
Conclusion
The auto parts sector in China is experiencing strong momentum, supported by solid production, new orders, and margin improvements. Deutsche Bank remains optimistic about the sector and maintains Buy ratings on Minth, Nexteer, Tuopu, and Huayu. The report highlights the importance of new product development, strategic partnerships, and market expansion for continued growth. However, the sector is not without risks, including external factors such as auto sales and raw material prices.
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