Wolong Electric (600580): Entering the ZF Motor Supply Chain to EV Motor Business
The company’s recent situation Wolong Electric Drive announced on June 10, 2019 that it had received a fixed letter from Germany’s Pick Ev 南宁桑拿 regarding the supply of new energy vehicle motors and parts and components. The estimated implementation period is from 2020 to 2026, and the amount is RMB 22.
About 5.9 billion.
The review entered ZF Motor’s supply chain, and its quality was recognized internationally.
ZF is the world’s leading supplier of automotive transmission systems, and is currently a leading company in the development of electric drive systems.
ZF has two main products for pure electric vehicles: DynaStart motor and electric axle drive.
Among them, electric drive axle products refer to the integration of motors, motors, and reducers, with high research and development accuracy. ZF, Bosch, and GKN are at the forefront, which is the main development trend of electric drive systems for high-end new energy vehicles in the future.
We believe 上海夜网论坛 that the entry of Wolong Electric Drive into ZF Motor’s supply chain can prove that the quality of its motors and related parts and components has reached the international first-line level.
Benefiting from global electrification speed and logging Evo localization strategy, EV motors help accelerate volume.
The global electrification trend is stable. ZF’s main customers BMW, Volkswagen, Mercedes-Benz, etc. have accelerated their electrification layout and occupied the Chinese market.
ZF also hopes to increase China’s local production ratio to 100% in the future.
We believe that Wolong Electric Drive will benefit from the acceleration of motor demand from international customers and the promotion of import substitution, and is expected to enter the motor supply system of more high-quality first-tier car companies to accelerate the volume of EV motor business.
Benefiting from the high boom in equipment spending in the coal, oil and gas, steel and other industries, the volume of high-voltage motors increased.
Since 2018, the added value of the core downstream industry of high-voltage electrical machinery business, such as oil and gas, and coal mining, has continued to improve, and the economy has maintained its prosperity in 1Q19.
High-voltage motor revenue in 2018 increased by 23.
4%, gross profit margin increased significantly by 8.
We expect the business to maintain prosperity in 19 years, bringing 20% -25% sector growth.
Low voltage motors and micro special motors are expected to grow steadily over the long term.
We believe that the company’s traditional low-voltage motor business has benefited from the growth of overseas revenue following the completion of the SIM acquisition, and the micro-motor business has mainly benefited from the improvement in gross profit margin brought about by the optimization of product structure.
It is recommended to maintain 19 / 20e 7.
2.7 billion net profit is expected to be 11.
5 yuan target price.
The current routine corresponds to 19 / 20e 16 / 13x P / E, and the target price corresponds to 19 / 20e 19 / 16x P / E, with 20.
4% upside, maintain recommended level.
Risks Lower-end capital expenditures of high-voltage motors were lower than expected, and actual demand for EV motor customers was lower than expected.