深圳大学 Stay real_长安汽车_决赛ppt

01Astr

id

03Fancy

02Gabriel Stay Real

Stay Real TeamFrom Shenzhen University

Valuation Report

ofChang’an

Auto

0102 03 04

Share DataBeta 1.18

Market Cap. 356.02(billion)Share Outstanding 33875.24(million)

Sector Auto manufactureTime to Market 10/06/1997

Financial Strength Company Industry

Quick Ratios 0.58 1.16Current Ratios 0.78 1.36Debt to Equity 19.05 59.33

Total Debt to Equity 77.56 97.59

Growth rateDurati

on 1Year 3Years 5Years

Sales% 10.96 4.81 16.51

EPS% 52.56 4.84 14.13

Key RatiosP/E 26.01P/B 2.38P/S 1.58ROA 3.65ROE 9.56EPS 2.38


05

Price Target (2013) 12.78~16.80

Current Price 10.51

High(TTM) 11.33(24/4/13)

Low(TTM) 4.61(3/7/12)

000001.SS 22177.91

Valuation Date 29/04/2013

Buy!

03Valuation Modeling--Price multipliers--Discount cash flow method

02

Background --Industry Introduction--Company Introduction

04 Summary


01

Financial Analysis--Time series--Cross sectional

Industry Background

▪ History

▪ Current famous bands:

▪ Large export numbers:

▪ Characteristics:

BYD, Lifan, Chang'an, Geely, Chery, Hafei, Jianghuai (JAC), Great Wall and Roewe

Export 814,300 units in 2011

44.30%56.70%

Market share

Local bandsJoint ventures

Volkswagen, General Motors, etc


S WO T


▪ Comparable low cost

▪ Scale effect of auto industry

▪ Largest producer and market ▪ Low R&D investment

▪ Customers preference

Chinese Auto Industry

▪ Government policy

▪ Monetary policy

▪ Global market

▪ Global competition

▪ Global issue

▪ Global economy

Industry Background

Company Background

Joint ventures

Automobile manufacturer

Chongqing

State-owned enterprise

“Top 4” Listed company

Innovation

Historical


Time-series

Cross-sectional

Financial Analysis Stay Real TeamFrom Shenzhen University

Revenue

Liquidity Ratios

Solvency Ratios

Activity Ratios

Profitability Ratios

Financial AnalysisTime series














Revenue

Financial AnalysisCross sectional


Company Chang'an Auto

Dongfeng Motor FAW Shanghai

Auto

Return on Assets 4% 0.11% 4.64% 6.52%

Return on Equity 9.56% 0.36% -9.47% 18%

source： tonghuashun data

Financial AnalysisCross sectional-Profitability



Crss sectionalFinancial AnalysisCross sectional-Activity



Auto

Total Asset Turnover

0.71 0.93 1.43 1.5

Accounts Receivable Turnover

62.41 23.15 279.39 34.92

Inventory Turnover

5.31 6.25 8.32 14.78



Financial AnalysisCross sectional-Liquidity



Auto

Cash ratio 0.14 0.356 0.166 0.299

Current Ratio 0.78 0.94 1.08 1.21

Quick Ratio 0.58 0.94 0.78 1.05



Financial AnalysisCross sectional-Solvency



Auto

Total Debt/Equity 1.98 1.48 1.04 1.19

Total Debt/Assets 0.66 0.596 0.5098 0.5433


Valuation Stay Real TeamFrom Shenzhen University

Price Multipliers

Comparable companies

Collect data

Calculate forecast standard

• 1. P/E ratio---EPS• 2. P/S ratio---Net Assets Per Share• 3. P/B ratio---Operating Earning Per Share

• 1. yearly P/E ratio---Price/EPS• 2. yearly P/S ratio---Price/NAPS• 3. yearly P/B ratio---Price/OEPS

Calculate Average/Median of yearly prediction


Standard Forecast ratio

Forecast Ratio Range

Forecast Ratio× yearly data

± 10%

Price Multipliers

• 1. P/E ratio---EPS• 2. P/S ratio---Net Assets Per Share• 3. P/B ratio---OEPS


Price Multipliers Stay Real TeamFrom Shenzhen University



/每股收益（元股）2009A 2010A 2011A 2012A 2013E 2014E 2015E

000927 一汽夏利 0.1102 0.1879 0.0681 0.0214 0.0625 0.0800 0.1000601633 长城汽车 0.37 0.99 1.22 1.8700 2.2723 2.7495 3.3354601238 广汽集团 0.54 0.92 0.69 0.1800 0.3980 0.5838 0.7450600609 金杯汽车 -0.365 0.257 0.028 0.0210 0.022636 0.024399 0.0263000800 一汽轿车 1.0009 1.1429 0.1332 -0.4648 0.3933 0.6500 0.77200625 长安B 0.46 0.87 0.2 0.3100 0.665 0.9016 1.4006

Target Company 000625 长安汽车 0.4600 0.8700 0.2000 0.3100 0.6650 0.9016 1.4006

Companies

Comparables

P/E ratio Method:


P/E ratio Method:

2014 2015Range -10.00% --- 10.00%P/E range 20.67735027 25.272317 14.08475 17.2147 11.77332 14.38961

13.75043793 16.8060908 12.69881 15.5208 16.48971 20.15409

2013

Stock Price range

Method 2013 2014 2015P/E method MAX 16.8060908 15.52076 20.15409

MIN 13.75043793 12.69881 16.48971


P/S ratio Method:

2009A 2010A 2011A 2012A 2013E 2014E 2015E

000927 一汽夏利 5.3707501 6.2007279 6.2399085 4.7029038601633 长城汽车 11.6999 20.9866 9.8899726 14.186052 17.153013 20.693151 24.356031601238 广汽集团 1.7934 1.422 1.7866 2.0146 2.5652134 3.0438864 3.501672600609 金杯汽车 3.7573538 4.2784244 4.2866504 4.6206021000800 一汽轿车 17.047312 22.955687 20.063084 14.368605 19.794495 26.43423 26.973671200625 长安B 10.7984 14.2205 5.4922 6.318531 8.187841 9.526688 10.39681


Companies 每股营业收入（元/股）

Comparables

2009A 2010A 2011A 2012A 2013E 2014E 2015E

000927 一汽夏利 0.8564912 0.7418484 0.7371903 0.9781191 - - -601633 长城汽车 3.0675476 1.7101389 3.6289282 2.5299499 2.0923438 1.7343902 1.473557601238 广汽集团 3.1950485 1.2611814 3.2072092 2.8442371 2.2337323 1.8824619 1.6363611600609 金杯汽车 1.0086886 0.8858401 0.8841402 0.8202394 - - -000800 一汽轿车 0.6957108 0.5166476 0.5911354 0.8254107 0.5991565 0.4486607 0.439688200625 长安B 0.924211 0.7018037 1.8171225 1.5794811 1.2188805 1.0475834 0.9599098

Target Company 000625 长安汽车 0.9732923 0.7390739 1.913623 1.6633613

Average 1.4178654 0.9112557 1.9963171 2.3458494 1.5360283 1.278274 1.127379Mean 0.9664498 0.8138443 1.3506313 1.2788001 1.6556122 1.3909868 1.2167334

CompaniesP/S

Comparables


P/B ratio Method:

每股净资产（元/股）2009A 2010A 2011A 2012A 2013E 2014E 2015E

000927 一汽夏利 2.16 2.26 2.3 2.3 2.36 2.43 2.51601633 长城汽车 2.77 3.66 5.5 7.07 9.132 11.57 14.77601238 广汽集团 - - 4.74 4.83 4.85 5.475 5.525600609 金杯汽车 0.03 0.29 0.32 0.34 0.366486 0.395035 0.425809000800 一汽轿车 4.69 5.31 5.14 4.67 5.2625 5.9525 6.4200625 长安B 3.77 4.57 3.05 3.33 4.0184 4.8921 6.2926


Companies

Comparables

P/B2009A 2010A 2011A 2012A 2013E 2014E 2015E

000927 一汽夏利 2.12963 2.035398 2 2 1.949153 1.893004 1.832669601633 长城汽车 12.95668 9.806011 6.525455 5.076379 3.930136 3.101988 2.429926601238 广汽集团 - - 1.208861 1.186335 1.181443 1.046575 1.037104600609 金杯汽车 126.3333 13.06897 11.84375 11.14706 10.34146 9.59408 8.900715000800 一汽轿车 2.528785 2.233522 2.307393 2.539615 2.253682 1.99244 1.853125200625 长安B 2.647215 2.183807 3.272131 2.996997 2.483576 2.040024 1.58599


Average 29.31913 5.865541 4.371927 4.015069 3.536417 3.116639 1.986931Mean 2.647215 2.233522 2.789762 2.768306 2.368629 2.016232 1.842897

Companies

Comparables


P/E P/S P/B ratio Method:

Method 2013 2014 2015P/S method MAX 13.83443083 13.3954894 12.89325404

MIN 11.31907977 10.9599459 10.54902603P/E method MAX 16.8060908 15.5207645 20.15408678

MIN 13.75043793 12.6988073 16.48970737P/B method MAX 15.63181055 16.7716007 13.75325873

MIN 12.78966317 13.7222188 11.25266623


P/E P/S P/B ratio Method:

Perpetual Value

Discount Rate

Future FCFF

Growth Rate

Discounted Cash Flow Method


FCFF

+Net Profit

+Depreciation and Amortization

-Increase on Working Capital

-Capital Expenditure

Net Profit

+Operating Income

-Operating Cost

-Business tax and surcharges

-Selling Expense

-Administrative Expense

+Profit from other Operations

-Corporate Tax

Historical FCFF

Discounted Cash Flow Method Stay Real TeamFrom Shenzhen University

Year 2008 2009 2010 2011 2012

Revenue 13,375,458,430.72 25,203,693,116.50 33,072,124,211.29 26,551,846,548.17 29,462,588,753.56

- Operating Cost 11,368,659,131.94 20,159,376,627.94 27,303,257,100.83 22,626,040,612.10 24,040,087,067.12

- Business tax and surcharges 322,563,843.47 539,629,495.88 676,194,533.95 537,733,641.71 759,633,210.06

- Selling Expense 1,136,557,740.87 2,466,774,396.87 3,230,353,574.57 2,142,325,839.67 2,629,835,059.39

- Administrative Expense 852,742,365.00 1,193,988,802.86 1,573,110,607.84 2,332,649,313.37 2,690,247,230.28

+ Profit from other Operations 560,845,000.54 804,155,981.27 1,631,226,158.61 1,702,230,331.45 1,868,541,181.38

Net Profit 191,835,262.48 1,236,059,830.67 1,440,325,914.53 461,495,604.58 908,495,526.07

Historical FCFF


Year 2008 2009 2010 2011 2012

Net Profit 191,835,262.48 1,236,059,830.67 1,440,325,914.53 461,495,604.58 908,495,526.07

+ Depreciation and Amortization 487,262,674.57 502,554,685.60 522,962,905.88 830,812,414.80 1,161,670,773.27

- Increase on Working Capital ----- 443,843,564.65 -995,347,277.00 -2,161,235,519.11 -865,924,700.09

- Capital Expenditure ----- -178,398,172.23 827,350,270.80 2,994,121,956.28 -405,057,482.24

FCFF ----- 1,473,169,123.85 2,131,285,826.61 459,421,582.21 3,341,148,481.67

Historical FCFF


External Factors• National Environment• Government Environment• Industry Environment

Internal Factors• The Growth Rate of Operating Income• The Growth Rate of Net Profit• The Proportion of Depreciation and Amortization in Operating Income• The Proportion of Working Capital in Operating Income• The Proportion of Capital Expenditure in Operating Income

Future FCFF


AssumptionsFuture Operating Income

Year 2008 2009 2010 2011 2012

Revenue 13,375,458,430.72 25,203,693,116.50 33,072,124,211.29 26,551,846,548.17 29,462,588,753.56

Year 2013 2014 2015 2016 2017

Revenue 32,691,688,480.95 6,274,697,538.46 40,250,404,388.68 44,661,848,709.68 49,556,787,328.26

10.96% Same as 2012!

Future FCFF


AssumptionsFuture Net Profit

Year 2008 2009 2010 2011 2012

Net Profit 191,835,262.48 1,236,059,830.67 1,440,325,914.53 461,495,604.58 908,495,526.07

Year 2013 2014 2015 2016 2017

Net Profit 1,069,299,234.18 1,258,565,198.63 1,481,331,238.79 1,743,526,868.06 2,052,131,123.70

17.7% From Tonghuashun

Future FCFF


AssumptionsFuture Depreciation and Amortization

Year 2008 2009 2010 2011 2012Depreciation and

Amortization 487,262,674.57 502,554,685.60 522,962,905.88 830,812,414.80 1,161,670,773.27

Year 2013 2014 2015 2016 2017Depreciation and

Amortization 1,078,825,719.87 1,197,065,018.77 1,328,263,344.83 1,473,841,007.42 1,635,373,981.83

3.3%

The average growth rate of Depreciation and Amortization of Operating Incomefrom 2008 to 2012

Future FCFF


AssumptionsFuture Incrementof Working Capital

Year 2008 2009 2010 2011 2012Increment on

Working Capital —— 443,843,564.65 -995,347,277.00 -2,161,235,519.11 -865,924,700.09

Year 2013 2014 2015 2016 2017Increment on

Working Capital -930,759,604.91 -1,105,064,817.64 -1,312,012,516.17 -1,557,715,724.10 -1,849,432,263.18

-7%

The Decline rate ofthe proportion of working capital in operating income

Future FCFF


AssumptionsFuture Capital Expenditure

Year 2008 2009 2010 2011 2012Capital

Expenditure ----- -178,398,172.23 827,350,270.80 2,994,121,956.28 -405,057,482.24

Year 2013 2014 2015 2016 2017Capital

Expenditure 1,242,284,162.28 1,378,438,506.46 1,529,515,366.77 1,697,150,250.97 1,883,157,918.47

3.8% Expand similarly

Future FCFF


ProjectionsFree Cash Flow to Firm

Year 2013 2014 2015 2016 2017

Net Profit 1,481,331,238.79 1,743,526,868.06 2,052,131,123.70 2,415,358,332.60 1,481,331,238.79

+ Depreciation and Amortization 1,328,263,344.83 1,473,841,007.42 1,635,373,981.83 1,814,610,970.24 1,328,263,344.83

- Increment on Working Capital -1,312,012,516.17 -1,557,715,724.10 -1,849,432,263.18 -2,195,779,141.97 -1,312,012,516.17

- Capital Expenditure 1,529,515,366.77 1,697,150,250.97 1,883,157,918.47 2,089,552,026.34 1,529,515,366.77

FCFF 2,592,091,733.01 3,077,933,348.60 3,653,779,450.24 4,336,196,418.47 2,592,091,733.01

Future FCFF


Perpetual Value

Discount Rate

Future FCFF

Growth Rate

Discounted Rate



𝐖𝐀𝐂𝐂=(𝟏−𝐓𝐜)𝐃

𝐃+𝐄𝐊𝐝+

𝐄𝐃+𝐄

𝐊𝐞

√

√Where D is the total debt

E is the total shareholder’s equity

is corporate income tax

is the cost of equity

is the cost of debt.

Future FCFF



Factors Figure Meanings

25% corporate income tax

3% free risk rate

12.21% expected rate of portfolio in the market

1.19


𝐊 𝐝 K d=¿

𝐊 𝐞 K𝐞=R f+ β∗(Rm− R f )

= 5.11%

= 13.96%

credit risk rate

Future FCFF


𝐖𝐀𝐂𝐂= (𝟏−𝑻 𝒄 ) 𝑫𝐃+𝑬

𝑲 𝒅+𝑬

𝐃+𝑬𝑲 𝒆

¿ (𝟏−𝟐𝟓%)∗𝟏𝟒 ,𝟔𝟔𝟕 ,𝟗𝟕𝟏 .𝟏𝟔𝟏 ,𝟒𝟎𝟕 ,𝟏𝟗𝟗 .𝟑

∗𝟓 .𝟏𝟏%+𝟒𝟔 ,𝟕𝟑𝟗 ,𝟐𝟐𝟖 .𝟐𝟔𝟏 ,𝟒𝟎𝟕 ,𝟏𝟗𝟗 .𝟑

∗𝟏𝟑 .𝟗𝟔%

¿𝟏𝟏 .𝟓𝟒𝟎𝟗𝟎𝟒𝟓𝟒%

11.54%

Future FCFF



𝑽 𝒕=∑𝒕=𝟏

∞ 𝑭𝑪𝑭𝑭 𝒕(𝟏+𝒈)

（𝟏+𝐖𝐀𝐂𝐂 ¿𝒕¿=

𝑭𝑪𝑭𝑭 𝒕

𝑾𝑨𝑪𝑪−𝒈

FCFF in next five years

Growth Rate

WACC

Year FCFF

2013 1,836,600,396.692014 2,182,256,528.582015 2,592,091,733.012016 3,077,933,348.602017 3,653,779,450.24

19%11.54%

Year Price

2013 13.552014 16.112015 19.132016 22.722017 26.96

Perpetual Value



Range of Stock Value: -10% to 10%

Year 2013 2014 2015 2016 2017

PriceMax 14.905 17.721 21.043 24.992 29.656

Min 12.195 14.499 17.217 20.448 24.264

Perpetual Value




Present Price: ¥11.14

01

02 03

Steady and potential

Undervalued

Promising prospect


Summary


Thank

you

Economy & Finance

深圳大学 Stay real_长安汽车_决赛ppt