Jinwu Financial News | HAITONG SEC research points out that YADEA (01585) is a leader in the electric two-wheeler market, primarily engaged in the R&D, production, and sales of electric two-wheelers and related products. The products mainly include electric two-wheelers, electric tricycles, Graphene lead-acid batteries, Sodium-ion Batteries, and their components. In 2023, revenue reached 34.763 billion yuan, with a compound annual growth rate of 19.15% from 2013 to 2023; the net income attributable to the parent was 2.64 billion yuan, with a compound annual growth rate of 28.05% from 2013 to 2023.
The report states that China's electric two-wheeler Industry has entered a mature stage, with ownership exceeding 0.35 billion vehicles by 2024. The "New National Standard" was officially implemented in 2019, and a new draft for consultation will be released in September 2024; the mandatory national standard for "Safety Technical Specifications for Lithium-ion Rechargeable Batteries for Electric Bicycles" is scheduled to be officially implemented on November 1, 2024. As the Industry standardizes, market concentration is expected to further increase. The overseas market is vast, with Southeast Asia having exceptional advantages: the motorcycle ownership in Southeast Asia is about 0.25 billion vehicles; the household penetration rate for motorcycles is as high as 75%. The low penetration rate of electric motorcycles and the high market potential are key characteristics of the electric two-wheeler market in Southeast Asia.
The report continues to state that the company is actively promoting its operational layout in Southeast Asia. In 2024, YADEA established an overseas production base in Bắc Ninh, Vietnam, which is planned to start production in 2025, with a designed annual capacity of two million electric motorcycles. At the same time, YADEA's smart production and research base in Indonesia will be completed in 2026, and in 2023, YADEA formed an exclusive strategic partnership with the dealer Indomobil in the Indonesian market. Additionally, the company is also actively laying out in various markets, including Europe, and has participated in several international exhibitions.
The report indicates that the company's net income is expected to reach 2.261 billion yuan, 3.021 billion yuan, and 3.499 billion yuan in 2024-2026, with year-on-year changes of -14.4%, +33.6%, and +15.8%, respectively. As of December 16, 2024, the closing price corresponds to a PE of 18.9 and 14.1 times for 2024-2025. As a leading enterprise in the electric two-wheeler Industry, comparable companies suggest a valuation of 15-16 times PE for 2025, corresponding to a reasonable value range of 14.56-15.53 yuan, which translates to 15.58-16.62 Hong Kong dollars (Exchange Rates: 1 RMB = 1.07 HKD), maintaining an "outperform the market" rating.
