Equity, Bottom-up Analyst, Investics Research

Sameer Taneja

A buy-side analyst with over 15 years of experience investing in Asian markets and specializing in the mid-small cap space, emphasizing value investing in companies with good free cash flows/dividends and long-term holding horizons. 
Exempt Financial Adviser (EFA) under CrossASEAN Research Pte Ltd. 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 Analyst

NIO – An Offering Not Lacking in Audacity

Weltmeister: Closely Competing With Xpeng

Xpeng IPO (Financial Analysis): More Products Than Li, But Generates A Gross Loss and Wider Net Loss

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

Forensic Accounting

<p><a href="https://www.smartkarma.com/entities/nio-inc" target="_blank" data-smartkarma-citation="entities:27399:1" rel="noopener">NIO Inc (NIO US)</a> is an oft discussed stock on several forums.  A Tesla "me too" this company listed with very lofty projections, a formidable shareholding list in Baille and Gifford, Hillhouse, Blackrock etc to name a few, and a great management team.  Unfortunately it's discussed now mainly for hemorrhaging cash due to several reasons.  In this insight I will look into their "trade receivables", which I believe are often overshadowed by its profitability/missed targets/recalls and other issues. I believe the sales practice that led to these receivables were a pillar of Nio's strategy to sell cars . Nio's business model fundamentally resembles Tesla's, so with direct selling to customers  ( no dealers ) there should technically be no receivables.  </p>
<p>We will seek to explain :</p>
<ol class="">
<li>Why does a company that sells directly to the customer have over 75 days of receivables ? </li>
<li>How popular was this practice that led to this balance sheet entry and is it still in existence ? </li>
<li>While innocuous in its affect on the balance sheet can the end of this practice essentially affect demand ? </li>
<li>What was the company trying to doing to counter this ? What is it trying now ?</li>
</ol>

NIO Inc (NIO US) is an oft discussed stock on several forums.  A Tesla "me too" this company listed with very lofty projections, a formidable shareholding list in Baille and Gifford, Hillhouse, Blackrock etc to name a few, and a great management team.  Unfortunately it's discussed now mainly for hemorrhaging cash due to several reasons.  In this insight I will look into their "trade receivables", which I believe are often overshadowed by its profitability/missed targets/recalls and other issues. I believe the sales practice that led to these receivables were a pillar of Nio's strategy to sell cars . Nio's business model fundamentally resembles Tesla's, so with direct selling to customers  ( no dealers ) there should technically be no receivables.  
We will seek to explain :

Why does a company that sells directly to the customer have over 75 days of receivables ? 
How popular was this practice that led to this balance sheet entry and is it still in existence ? 
While innocuous in its affect on the balance sheet can the end of this practice essentially affect demand ? 
What was the company trying to doing to counter this ? What is it trying now ?


Nio's Often Overlooked "Trade Receivables"