Economic Observer reporter Liang Ji Since it reached the "market bottom" at the end of April 2022, A-shares have ushered in a long-lost strong rebound. During this period, the new energy sector has experienced a particularly strong rally. From April 27th to June 24th, the new energy index (884035.WI) had a strong upward trend, with a range increase of more than 50%; the range growth of new energy-related sector indices such as lithium batteries also far exceeded the performance of the broader market in the same period. The ChiNext Index, which has a higher weight in new energy, also significantly outperformed the Shanghai Composite Index and the Shenzhen Component Index during the same period.
From the beginning of the year to April 26, with the market stomping on the market several times, the new energy sector fell sharply, and the new energy index fell by more than 40% during the period. It is precisely because of this that the previous sharp correction has created sufficient space for this round of rebound, and the government's policy support for stable economic growth and the "dual carbon" goal and support for the new energy industry chain also support the continuous upward trend of the new energy sector. Since June, the leading new energy stocks CATL (300750.SZ) and BYD (002594.SZ) have successively reached the trillion-dollar market value; as of the close of June 24, the market values of the two were 1.31 trillion and 1.02 trillion respectively. Yuan.
Investors who were happy and sad with the rise and fall of new energy sighed with emotion: The new energy duo is back!
Looking back on 2021, while the white wine and other consumption horses are falling, the new energy sector is rising, and investors have given the expectation of leading A-shares out of the long-term bull after China's economic transformation and upgrading. Anchor of stocks. Since 2022, the new energy sector has fallen to the altar, and many investors have withdrawn all their previous gains. The doubts about "Ning Wang" and the shaking of investment confidence in the new energy sector have become a kind of torture for "new energy believers". The revival since the end of April has made investors cry: Is new energy worth looking forward to?
New energy revival
From the beginning of the year to the end of April, A-shares fluctuated downward amid repeated epidemics and geopolitical conflicts, with frequent stampede. The broader market dropped sharply several times in late January, mid-March and late April.
After reaching the "market bottom" on April 26, A shares turned around and entered the upward lane. Since May, the A-share market has continued to pick up, and the daily turnover of the Shanghai and Shenzhen stock markets has also remained near one trillion yuan. The inflow of northbound funds has accelerated significantly, the newly issued funds have recovered slightly, the long positions of private equity stocks have increased, and the two financing funds have also turned into net inflows. Wind data shows that from May to June 24, 2022, the total net purchase of northbound funds was 64.8 billion yuan, of which 6 trading days net purchases exceeded 10 billion yuan.
Zhang Yidong, chief strategist of Industrial Securities, said that in the long run, China's equity assets still have significant advantages under the continuous repair of domestic fundamentals, and it is expected to continue to attract foreign investment to return to normal allocation in the future.
According to the data, from April 26 to June 24, the major A-share indexes generally rose, the Shanghai Composite Index rose 16.05%, the Shenzhen Component Index rose 24.29%, the ChiNext Index rose 31.34%, and the New Energy Index rose 31.34%. In the same period, the increase reached 53.71%, becoming a pioneer in the rebound.
Since April 27, the new energy sector has been rising after bottoming out. BYD's share price has skyrocketed from a minimum of 281.81 yuan to the first trillion-dollar market capitalization on June 10; by the close of June 24, the stock price has reached 351.05 yuan, with a total of 351.05 yuan. The market value reached 1022 billion yuan. After the previous downturn in the Ningde era, it started from a minimum of 366.74 yuan on April 27, and fluctuated upwards. On June 2, the market value once again stood at one trillion yuan; on June 24, it closed at a new high of 563.50 yuan in the second round, and the market value reached 563.50 yuan. 1313.4 billion yuan.
From the perspective of northbound funds, it has continued to buy large amounts of net recently, but it has increased its positions in consumption, finance and coal sectors, and has instead reduced its allocation to leading new energy stocks. Wind data shows that the northbound funds sold a net 6.039 billion yuan of CATL in the past month, and Ganfeng Lithium, BYD and other track stocks were also sold during the same period.
From May to June 21, the net inflow of the two financial institutions was 47.4 billion yuan, of which the net inflows in May and June were 15.2 billion yuan and 32.1 billion yuan respectively. From the perspective of the balance of the two financings, the balance of the two financings rebounded to 1.57 trillion yuan on June 21, an increase of 55.8 billion yuan from the end of April; from the perspective of the two financing transactions, as of June 21, the proportion of transactions in June has rebounded to 8.08%, an increase of 1.31% and 0.79% compared with April and May respectively, and the transaction activity of the two integration has gradually picked up compared with the previous period. From the perspective of industry structure, the top four industries with relatively high balance of financing and financing are medicine, electronics, non-banking financial and power equipment and new energy, etc., which are the sectors that have frequently led the market recently.
Zhao Yuanyuan, investment director of Jianhong Times, believes that new energy, as an institutional heavy-holding sector, has previously experienced year-end profit settlement of domestic institutions and foreign institutions due to liquidity contraction and geopolitical shocks. Later, as the most certain beneficiary of post-epidemic recovery, new energy vehicles have become the backbone of this round of rebound: the resumption of work on the supply side has greatly repaired the automotive industry chain, while the demand side has benefited from the increase in travel demand after the epidemic, the expected recovery in residents’ income and Policies such as purchase tax subsidies are favorable; in addition, new energy has also received strong financial support. It predicts that this round of market conditions will last at least until mid-July and June sales data are released. "This round of rebound in the new energy sector is supported by both policies and fundamentals." Hu Bo, manager of Rongzhi Investment Fund, said, especially the sales data of new energy vehicles and the export of photovoltaic products have performed well, which provides an opportunity for this round of rebound. Fundamental support, and therefore sought after by mainstream funds in the market, especially institutional funds, has become the main line of this round of market.
In addition to policies and fundamentals, Chuancai Securities analyst Sun Can judged from the perspective of demand that as the impact of the epidemic gradually subsides, downstream demand will maintain resilient growth, especially the recovery of overseas car companies' demand is accelerating. The process is accelerating. It is expected that the release of new production capacity of leading enterprises in June may lead to a significant increase in market supply, the overall recovery of downstream demand exceeds expectations, and the overall market will usher in a wave of demand rebound.
With the ups and downs of the new energy sector, its valuation changes have also become the focus of the market.
Ma Cheng, chairman of Juze Investment, believes that after the adjustment of the new energy track for about half a year, the initial valuation bubble has been released. Combined with its high growth, the current valuation level is basically reasonable; from a long-term perspective , has reached the interval for reconfiguration.
According to He Li, general manager of Zhishan Investment, the new energy sector has a certain attractive market price after a long period of adjustment. At the same time, the overall beta of the new energy track last year was very strong, and the track stocks basically ushered in a surge; this year, with the rapid development of the industry and performance disclosure, leading new energy companies with technical strength, financial strength, and efficient organizational capabilities Will come out of the independent alpha market.
The hot market in the new energy sector in the middle and late June has exceeded the expectations of He Chenjun, manager of Hanji Investment Fund. He feels that this sector has entered a medium and high risk area in the short term, and his first reaction to the high valuation is to reduce the position. Down, the position has been lightened, and it is expected to see a stage high in early July.
He Li said that the new energy sector also needs to consider the valuation and wait for a sufficient margin of safety to invest. Judging from the current trend of lithium ore stocks, in fact, the market has not given a valuation corresponding to the ridiculously high lithium ore price, which also means that the market has certain expectations for the future outlook of lithium ore prices.
New energy vehicles are hot
Although the results of the interim report have not yet been realized, the booming production and sales of new energy vehicles and the rising demand for overseas photovoltaics have solidly promoted this round of rebound. However, many interviewees said that the market performance of the new energy sector since May was related to the overall warming of the broader market. In particular, the conflict between Russia and Ukraine at the end of February caused commodity prices to break loose, and the soaring upstream raw material costs will inevitably squeeze new energy vehicles. Performance of mid- and downstream enterprises in the industrial chain. Previously, the stock price of CATL had fluctuated sharply due to its lower-than-expected quarterly report and other market rumors.
On April 29, CATL released its first quarterly report for 2022, and its performance was significantly lower than expected. The financial report shows that during the reporting period of CATL, the revenue increased by 153.97% year-on-year to 48.678 billion yuan, but the net profit fell by 23.62% year-on-year to 1.493 billion yuan, and the decline in non-net profit deducted further expanded to 41.57%. The financial report also shows that the derivative financial liabilities of CATL in the first quarter were 1.787 billion yuan; the cash flow hedging reserve was -1.178 billion yuan, compared with -174 million yuan in the same period last year.
CATL explained at the performance interpretation meeting that the sharp rise in prices of raw materials such as lithium carbonate and electrolyte since 2021 has put pressure on the company's operations. Negotiate with major customers to face the pressure of rapidly rising raw material costs. As for the fluctuation of hedging, CATL said that the company will have a special subject to manage the profit and loss when hedging metal prices and foreign exchange prices. There is no actual gain or loss.
On June 9, CATL issued a clarification announcement, explaining that the semi-annual report may confirm the loss of more than one billion yuan in futures investment in the first quarter, and the company's No. 2 figure, Huang Shilin, has significantly reduced holdings and cashed out. The announcement stated that in order to ensure the stable supply of the company's raw materials and the need to reduce costs, a partial layout of the nickel resource industry chain was made to avoid the risk of large fluctuations in the commodity market, not for speculation. Ningde Times said that the hedging business is based on the spot, and the floating profit and loss on the futures side is hedged by the corresponding spot, which has little impact on the company's performance. The above rumors are not true.
As for the rumors about the reduction of important shareholders, Ningde Times also clarified that Huang Shilin transferred his company shares to a private equity fund held 100% by himself, which did not lead to changes in his shareholding ratio, and there was no disguised reduction of holdings.
The market value of CATL returned to one trillion on June 2. The CITIC Securities new energy vehicle team believes that in the past three years, the average PE valuation of CATL was about 101 times, and the average PB valuation was about 8.7 times; while the GEM refers to the past three years. The average PE valuation is about 58 times. It can be seen that for industry leaders with high growth attributes, the market is willing to give them a higher valuation premium.
On June 10, BYD became the only domestic auto company with a market value exceeding one trillion yuan, and its market value was supported by its dazzling sales data.
According to data from the China Association of Automobile Manufacturers, in May 2022, the sales of new energy vehicles were 447,000 units, an increase of 105% year-on-year; among them, BYD sold 115,000 units, an increase of 148% year-on-year, setting a record high and ranking first in the market. In the first five months of this year, BYD's cumulative sales were 507,300 units, a year-on-year increase of 348%, and 34% of the original annual sales target of 1.5 million units has been achieved. In the first quarter of this year, BYD achieved revenue of 66.825 billion yuan and net profit of 808 million yuan, up 63.02% and 240.59% year-on-year respectively.
As of June 24, the price-earnings ratio of CATL was 84.90 times, and that of BYD was as high as 282.60 times. He Chenjun told the Economic Observer that the new energy sector has a high probability of achieving high revenue growth this year, which is also the main factor supporting the market value of a stock market. Net profit will be affected by the economic situation and changes in the industry, and soaring upstream costs will inevitably eat up. lose some profit. Ma Cheng also believes that the skyrocketing price of upstream lithium mines has squeezed the profit margins of mid- and downstream enterprises and reduced gross profit margins; under the background that the next "lithium" is hard to find, the bargaining power of mid- and downstream enterprises is quite limited.
Lang Chengcheng, general manager of the research department of Furong Fund, judged that with the gradual recovery of enterprise production, the suppression of the epidemic has eased, and the market's restoration of profit expectations for new energy companies will form the first upward momentum. In terms of raw materials, silicon materials and lithium mines have a certain capacity release in the second half of the year. It is expected that upstream prices will also decline in the second half of the year, which means that the profits of the midstream manufacturing end will increase, and the midstream does not need to pass on costs, and product prices will naturally decline. It will lift the suppression of demand, and the new energy sector may form a rise in volume and price.
Institutions focus on high prosperity
On June 22, Ningde Times issued an announcement to disclose the results of the fixed increase. The price of the fixed increase was 410 yuan per share, which was 120.71% of the base price. The amount of funds raised was about 45 billion yuan, and the actual net amount of funds raised was 44.87 billion yuan. .
The announcement shows that CATL has a luxurious lineup of "fixed growth groups" this time. Including domestic and foreign financial institutions such as Morgan Stanley, JPMorgan Chase, Guotai Junan, Taikang Assets, HSBC, GF Securities and Caitong Fund. In terms of the amount allocated, Guotai Junan, JPMorgan Chase and Barclays Bank ranked the top three with 4.66 billion yuan, 4.07 billion yuan and 3.36 billion yuan respectively. It is worth noting that HHLR Management Co., Ltd.-HHLR China Fund (Hillhouse) was allocated 7,317,100 shares, and the allotment fund was about 3 billion yuan. This is also the third time that Hillhouse participated in the fixed increase of CATL.
The prospect of new energy is improving, and the Ningde era, which is a leading stock, has been collectively held by fund companies. Wind data shows that as of the end of the first quarter of this year, Ningde Times replaced Kweichow Moutai (600519.SH) as the most heavily held stock in fund products. A total of 1911 funds from 126 fund companies held shares in Ningde Times, with a total of 286 million shares, corresponding to a total market value of 146.708 billion yuan.
Last year, the market in the new energy sector was hot, which caused institutions to hold a heavy position in new energy, and other thematic fund styles drifted and held heavy positions in new energy stocks, which attracted the attention of the market and regulators. Concentration of weights will magnify the rise and fall of individual stocks and cause bubbles to become a worrying issue. However, some market participants believe that institutions have their own logic to form a group. Ma Cheng said that there are not many sectors that can be configured in the current market, and the new energy sector is the most certain sector at present and in the future, so it is not surprising for institutions to form a group. It is expected that the new energy track will still be hyped by institutions in the future. .
He Li told the Economic Observer that the style of institutions holding heavy positions has always existed. What remains unchanged is that institutions have been looking for the fastest-growing, best-performing and most certain sectors in the market. Development and market changes are constantly chasing group targets, which is also a very common phenomenon in developed markets such as U.S. stocks.
He believes that institutions' heavy holdings in the new energy sector, especially the Ningde era, have become the largest holding stocks of institutions, indicating that institutions recognize the high prosperity of the sector; however, we must also be wary that institutional grouping will lead to high valuation bubbles. For value investment, More attention should be paid to the safety margin of valuation and reasonable allocation.
Zhao Yuanyuan also reminded that a sector with both performance and growth such as new energy vehicles is very attractive to institutions, driving up the valuation premium of the sector; but on the other hand, if negative information such as data is lower than expected, it will easily lead to stampede. Growth industries will face the dilemma of long-term slowdown in growth rate and downward valuation after the penetration rate exceeds 20%. At present, the PE of the lithium battery industry still has not returned to the high point in the fourth quarter of last year, and theoretically, there is not much room for the valuation of the entire industry to improve. However, if individual companies make innovations in battery technology or profit models, the valuations of companies with increased market share may still reach new highs.
Hu Bo believes that there have been doubts about the high valuation price-earnings ratio of new energy stocks recently, whether new energy is a technology industry or high-end manufacturing, and in the long run, new energy is not only high-end manufacturing, but may even achieve industrial upgrading, intelligent possibility of transformation.
On June 22, the executive meeting of the State Council decided to increase the support policy for automobile consumption to further release the potential of automobile consumption. Prior to this, Beijing, Shanghai, Shenzhen and other places have also introduced policies to support the consumption of new energy vehicles, providing subsidies and indicators to consumers and other practical benefits. In addition, the EU seeking to ban the sale of new fuel vehicles by 2035 and the US adjusting its photovoltaic tariff policy are all positive for the new energy industry. According to data from the China Automobile Association, in May, China exported 43,000 new energy vehicles, a year-on-year increase of 1.3 times. The export growth rate reversed the downward trend for three consecutive months and rebounded sharply.
Wang Yang, the fund manager of Cathay Pacific Fund, believes that the biggest wave of repairs to market sentiment has ended. In the short term, it is necessary to pay attention to the performance of the company's mid-term report, and to judge the prosperity of the sub-sectors from the second half of the year to the next year. It believes that the most beneficial sector logic must be the areas with increased penetration and less impact on the macro economy. In the uncertain domestic and foreign environment, the relatively high speed, sustainability and robustness of growth are the most important factors against uncertainties. Important stock selection criteria.
BOC Securities believes that stimulated by the resonance of policies, supply, cost and other factors, the global new energy vehicle market is booming, and sales will increase significantly in 2021; in the first half of 2022, affected by the epidemic and the conflict between Russia and Ukraine, short-term consumer demand will not be sufficient. The increased certainty will affect the industry's prosperity; in the second half of 2022, as the domestic epidemic recedes and the land subsidy policy is introduced, the industry's prosperity is expected to gradually recover. In the context of carbon neutrality, favorable overseas policies are frequently issued, the electrification process of mainstream car companies has accelerated, and high-quality supply has followed, and the demand for new energy vehicles is expected to continue to rise.