CITIC Construction Investment: Automobiles are a macroeconomic driver and a key gripper for consumption, and the Golden, Jiuyin, and Ten Boom Continues

The Zhitong Finance App learned that CITIC Construction Investment published a research report saying that on September 25, the Ministry of Commerce's trade-in platform had received more than 1.13 million subsidy applications. Over the past month, about 450,000 new subsidy applications have been added, and the effects of car trade-in continue to show. Macroeconomic expectations are warming up. Automobiles are a key driver of macroeconomic growth and consumption, and are expected to usher in a new round of market conditions. Commercial vehicle exports to the sea continue to be compounded by a bottom recovery in domestic demand. The implementation of subsidy rules will support the recovery of the industry and ease the pressure on the profit side of leading companies. Valuation is expected to rebound under good parts performance and delivery. Focus on targets related to intelligence, robotics, low-altitude economy, and overseas travel, and wait for parts to rebound.

Passenger cars: According to the Passenger Federation statistics, passenger cars sold 2.11 million units in September, +4.5% year over year and +11.0% month over month, with excellent performance. According to preliminary statistics, retail sales of new energy vehicles reached 1.123 million units in September, a year-on-year increase of 51% and a month-on-month increase of 10%. On September 25, the Ministry of Commerce's trade-in platform has received more than 1.13 million subsidy applications. Over the past month, about 450,000 new subsidy applications have been added, and the effects of car trade-in continue to show. Local subsidies gradually followed up, wait-and-see demand was further released, and the release of consumption potential was better than expected. Since September 24, expectations have gradually picked up due to positive macroeconomic statements. Automobiles are expected to usher in a new round of market conditions as macroeconomic incentives and an important gripper for consumer trade-in subsidies. At this point, I am optimistic about positioning the mainstream market (high subsidy flexibility), the share of new energy sources (high subsidy amount), and Huawei is the main line.

Commercial vehicles: In September, commercial vehicle production and sales were 294,000 units and 284,000 units, respectively, +8.7% and +4.4% month-on-month; -16.8% and -23.5% year-on-year respectively. During the year, commercial vehicles mainly benefited from economic growth and the continued recovery in domestic demand at the bottom. At the same time, the implementation of policy rules and subsidies that exceeded expectations will further support the recovery of the industry and ease pressure on the profit side of leading companies. It is recommended to focus on undervalued leading targets with strong performance.

Parts: Valuations are expected to pick up under good performance and fulfillment. The core suppression points are valuation flexibility, chip structure, and export policy risks. The current trend of individual stocks is fragmented, and the offshore theme and robotics and low-altitude economy sectors are receiving a high level of attention. It is recommended to allocate undervalued Hakuba parts targets with excellent performance and parts targets with a new growth curve. Tesla continues to develop low-cost models, and related industry chains are expected to pick up. The industry trend in the low-altitude economy is similar to robots in 2021. We will continue to focus on the direction of growth, including targets related to going overseas, the Changpo Heavy Snow Robot Track, and the low-altitude economy, etc., and wait for the bottom to rebound.