Equity, Bottom-up Analyst, Investics Research

Sameer Taneja

Equity, Bottom-up Analyst

Investics Research

It is important to note that the information provided by Investics Research is based on publicly available data and own knowledge, which has been gathered and analyzed from a variety of sources. While every effort has been made to ensure the accuracy and completeness of the information provided, it is not guaranteed to be free from errors or omissions. All forecasts and estimates are based on information that has been obtained from public sources that are considered to be reliable. The sources include but are not limited to, company announcements, exchange filings, presentations, etc. Investics does not guarantee the accuracy and completeness of the forecasts, estimates, and/or other information.

Equity Bottom-up Research

Equity Bottom-Up

Eva Precision Industrial Holdings / Equity Bottom-Up

<ul>
<li>
<a href="https://www.smartkarma.com/entities/eva-precision-industrial-holdings-ltd" target="_blank" data-smartkarma-citation="entities:17511:1" rel="noopener">Eva Precision Industrial Holdings (838 HK)</a> has come off its lows but still trades at an attractive  7.8x/5x PE FY22e/23e and a dividend yield of 3.8%/5.9% FY22e/23e (assuming 30% payout).</li>
<li>The auto business should be propelled forward by orders from EV stalwarts, BYD, Nio, Tesla, etc. We expect the auto business (30% of revenue) to grow 50% in 2023.</li>
<li>Another two catalysts we look forward to are the split of the auto business to unlock value and the completion of the buyback announced by the company in 2022.</li>
</ul>



Eva Precision Industrial Holdings (838 HK) has come off its lows but still trades at an attractive  7.8x/5x PE FY22e/23e and a dividend yield of 3.8%/5.9% FY22e/23e (assuming 30% payout).
The auto business should be propelled forward by orders from EV stalwarts, BYD, Nio, Tesla, etc. We expect the auto business (30% of revenue) to grow 50% in 2023.
Another two catalysts we look forward to are the split of the auto business to unlock value and the completion of the buyback announced by the company in 2022.


EVA Precision: Updates, Poised For a Rally

External broker reports(aggregated public sources), CMB International

CMB International

External broker reports(aggregated public sources)

Incorporated in Hong Kong, supported by the mainland and targeting in global market, CMB International Capital Corporation Limited (“CMBI”) is an integrated financial institution providing comprehensive and professional services. As a wholly-owned subsidiary of China Merchants Bank ("CMB"), by leveraging on the Group’s synergy and coordination in domestic and overseas markets, as well as CMB’s strong resources and outstanding social reputation, CMBI and its subsidiaries have been actively implementing diversified business strategies and set up an overall layout of main business segments including Corporate Finance, Asset Management, Wealth Management, Global Markets and Structured Finance, etc. Adhering to the philosophy of “being clients oriented and increasing our own values by the way of creating value for clients”, CMBI endeavors to provide quality and integrated financial services to institutional, corporate and individual customers both domestic and overseas including Hong Kong IPO sponsorship and underwriting, share placement and rights issue for listed companies, financial advisors, bonds issuance services, asset management, direct investment, wealth management, equity sales and trading, etc.

Thematic (Sector/Industry)

<div><div><div><div><ul><li>China’s passenger-vehicle (PV) retail sales volume, based on insurance data, rose 9% YoY to 1.86mn units in Sep 2022, 3% lower than our prior forecast.</li><li>Wholesale volume surged 33% YoY to 2.33mn units, 8% higher than our prior projection due to more inventories pushed to dealers than expected.</li><li>Almost 260,000 units of inventories were added into dealers in Sep 2022, the most in any Sep in history. </li></ul></div></div></div></div><p><em>Content is external broker report sourced from online content aggregator through publicly available sources and is displayed below for general informational purposes only. Refer full disclaimer below.</em></p>

China’s passenger-vehicle (PV) retail sales volume, based on insurance data, rose 9% YoY to 1.86mn units in Sep 2022, 3% lower than our prior forecast.Wholesale volume surged 33% YoY to 2.33mn units, 8% higher than our prior projection due to more inventories pushed to dealers than expected.Almost 260,000 units of inventories were added into dealers in Sep 2022, the most in any Sep in history. Content is external broker report sourced from online content aggregator through publicly available sources and is displayed below for general informational purposes only. Refer full disclaimer below.

China Auto Sector – 2H22E likely beat; FY23E consensus overstated

<ul>
<li>Post a 40% correction, <a href="https://www.smartkarma.com/entities/eva-precision-industrial-holdings-ltd" target="_blank" data-smartkarma-citation="entities:17511:1" rel="noopener">Eva Precision Industrial Holdings (838 HK)</a> is now at a PE of 9x/5.8x FY22/23e with a dividend yield of 3.0/5.1% FY22/23e (assuming a 30% payout ratio).</li>
<li>The company has resumed buybacks since the 13th of October, purchasing 1.43 mn shares (0.08% of outstanding shares) over four trading sessions. We see this trend continue for two weeks.</li>
<li>Catalysts here would come from solid earnings releases, strong order book-related announcements, and a potential to unlock value from the business. </li>
</ul>


Post a 40% correction, Eva Precision Industrial Holdings (838 HK) is now at a PE of 9x/5.8x FY22/23e with a dividend yield of 3.0/5.1% FY22/23e (assuming a 30% payout ratio).
The company has resumed buybacks since the 13th of October, purchasing 1.43 mn shares (0.08% of outstanding shares) over four trading sessions. We see this trend continue for two weeks.
Catalysts here would come from solid earnings releases, strong order book-related announcements, and a potential to unlock value from the business. 


EVA Precision: Catalysts Galore, Lots to Look Forward to in FY23

<ul><li>NIO, Xpeng miss, Li L9 exceeded 10,000 units. Both NIO and Xpeng just hit the lower bound of their 3Q22 sales guidance.</li><li>NIO’s Sep sales volume was about 1,000 units lower than our prior estimates due to sequentially declining sales volume for the ET7.</li><li>We suspect NIO’s supply chain issue is still lingering given ET7’s sufficient order backlog.</li></ul><p><em>Content is external broker report sourced from online content aggregator through publicly available sources and is displayed below for general informational purposes only. Refer full disclaimer below.</em></p>

NIO, Xpeng miss, Li L9 exceeded 10,000 units. Both NIO and Xpeng just hit the lower bound of their 3Q22 sales guidance.NIO’s Sep sales volume was about 1,000 units lower than our prior estimates due to sequentially declining sales volume for the ET7.We suspect NIO’s supply chain issue is still lingering given ET7’s sufficient order backlog.Content is external broker report sourced from online content aggregator through publicly available sources and is displayed below for general informational purposes only. Refer full disclaimer below.

China Auto Sector – Set for NEV new-high sales in Sep and 4Q22

<div><div><div><div><ul><li>China’s passenger-vehicle (PV) wholesale volume surged 37% YoY to 2.13mn units in Aug 2022, 1% higher than our prior projection.</li><li>Similar to Jul 2022, that figure made the best Aug wholesale volume in history and 13% higher than the second-best Aug sales occurred in 2017.</li><li>Retail sales volume, based on insurance data, rose 18% YoY to 1.89mn units, 2% lower than our prior forecast.</li></ul></div></div></div></div><p><em>Content is external broker report sourced from online content aggregator through publicly available sources and is displayed below for general informational purposes only. Refer full disclaimer below.</em></p>

China’s passenger-vehicle (PV) wholesale volume surged 37% YoY to 2.13mn units in Aug 2022, 1% higher than our prior projection.Similar to Jul 2022, that figure made the best Aug wholesale volume in history and 13% higher than the second-best Aug sales occurred in 2017.Retail sales volume, based on insurance data, rose 18% YoY to 1.89mn units, 2% lower than our prior forecast.Content is external broker report sourced from online content aggregator through publicly available sources and is displayed below for general informational purposes only. Refer full disclaimer below.

China Auto Sector – What we worried earlier is partially priced in now

Hong Kong

EVA Precision Industrial Holdings Limited, through its subsidiaries, designs and fabricates metal stamping moulds, manufactures metal stamping components, and provides assembly services in the Peoples Republic of China.

Eva Precision Industrial Holdings (838 HK)

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Eva Precision Industrial Holdings (838 HK)

EVA Precision: Updates, Poised For a Rally

Eva Precision Industrial Holdings (838 HK) has come off its lows but still trades at an attractive 7.8x/5x PE FY22e/23e and a dividend yield of...

Sameer Taneja

China Auto Sector – 2H22E likely beat; FY23E consensus overstated

China’s passenger-vehicle (PV) retail sales volume, based on insurance data, rose 9% YoY to 1.86mn units in Sep 2022, 3% lower than our prior...

CMB International

EVA Precision: Catalysts Galore, Lots to Look Forward to in FY23

Post a 40% correction, Eva Precision Industrial Holdings (838 HK) is now at a PE of 9x/5.8x FY22/23e with a dividend yield of 3.0/5.1% FY22/23e...

Sameer Taneja

China Auto Sector – Set for NEV new-high sales in Sep and 4Q22

NIO’s Sep sales volume was about 1,000 units lower than our prior estimates due to sequentially declining sales volume for the ET7.

CMB International

China Auto Sector – What we worried earlier is partially priced in now

Similar to Jul 2022, that figure made the best Aug wholesale volume in history and 13% higher than the second-best Aug sales occurred in 2017.

CMB International

Price Gauge

52-week Range

Market Cap (USDm)

P/E

Dividend (Yield)