Soochow Securities: EV is still the lowest point of the expectation, and we are optimistic that the low point of profitability will appear in May-June, and the plate is brewing a reversal after the order recovery.

Soochow securities released a research report, said the current electric car is still the fundamentals, valuation, expectations of the lowest point, look forward to May-June earnings lows appeared + order recovery after the plate brewing reversal, strongly recommended layout, the first push battery ningde times (300750.SZ), yi wei lithium energy (300014.SZ), pie can technology (688063.SH), etc., the structure of Kodali (002850), electrolyte leader tenci materials (002709.SZ), new zeobang (300037.SZ), high-end electrolyte leaders (002709.SZ), new zeobang (300037.SZ), the new zeobang (300037), the new zeobang (300037). SZ), electrolyte leader Tianci Materials (002709.SZ), New Aegis (300037.SZ), high-end negative electrode and material platform Pu Tailai Lai (603659.SH), diaphragm Enjie shares (002812.SZ), Star Source Materials (300568.SZ), anode leader Rongbai Technology (688005.SH), Dangsheng Technology (300073) SZ), DeFang Nano (300769.SZ) and so on.

China Association of Automobile Manufacturers (CAAM) data, domestic sales of 525,000 electric vehicles in March 2023, the same ring +34.8% / +24.4%, the penetration rate of 26.6%, the ring is flat over the market expectations.

2023 domestic sales rate of decline in the market has been fully expected, is expected to 23 years of domestic new energy vehicle sales 9.001 million units (neutral expectations), an increase of 31%, of which exports 1-1.2 million units.

European mainstream nine countries in March electric vehicle sales growth rate has recovered. European mainstream nine countries combined sales of 246,000 units, the same ring +20% / +82%, of which 172,000 units of pure electric sales, an increase of 32% year-on-year, the proportion increased to 70%, the EV penetration rate of 22.0%, the same ring -1/+1.9pct.

U.S. March 2023 EV registrations 116,200 units, +42% y-o-y, +6% YoY, including 93,100 pure electric registrations and 23,100 plug-in hybrid registrations. Passenger cars registered 1,375,500 units, +10% y-o-y, +18.4% q-o-q. EV penetration rate was 8.4%, +1.9/-1.0 pct y-o-y.

Auto show is approaching, is expected to June EV orders will be significantly restored, scheduling is expected to improve in May, June is expected to be significantly stronger.

According to the data of the passenger association, the inventory of passenger cars at the end of January was 3.33 million units, the inventory cycle of 64 days, is expected to be mainly fuel car inventory.

Since February, Hubei Province launched a limited-time car purchase subsidy, Dongfeng Citroen C6 from the original price of 210,000 yuan price reduction of 90,000 yuan to 120,000 yuan, triggering Mercedes-Benz, BMW, Volkswagen and other joint-venture car companies to reduce prices. It is expected that this round of price cuts or manufacturers have inventory clearance needs. 3-4 months part of the new orders of electric vehicle enterprises have an impact, but the overall controllable, it is expected that the June electric vehicle orders can be fully restored to normal scheduling to see that most of the manufacturers in March scheduling production has been restored, the battery enterprises ring growth of 20-30%, 10-20% of the anode manufacturers, 10-20% of the precursor.

Overall look production low point has passed, March production is expected to increase 10-20%, due to Q1 industry inventory, production is expected to decline 10-30%, 4-6 months gradually recovered in June is expected to return to normal.

Lithium carbonate futures bottomed out rebound, the industry chain inventory is very low, most of the links within the year earnings can be basically bottomed out.

23 April lithium carbonate prices fell to 187,000 yuan / ton, measured the current 523 / lithium iron battery pack cost down to 0.72 / 0.56 yuan / Wh, back to the 21Q4 / 21Q3 level, April 14 Wuxi plate lithium carbonate rose 11.9% to 156,000 yuan / ton, the inventory is mostly concentrated in the upper reaches of lithium salt plant, the middle reaches of the material inventory is extremely low, basically maintain the minimum safety of the 7-day Inventory, if the demand recovery, will bring a strong demand for inventory replenishment.

At the same time, lithium carbonate price dropped significantly, the cost of car companies fell significantly, the average price of lithium carbonate from the high point of 550,000 fell to 150,000 / tonne, to 60kwh pure electric for example, the cost fell 12,000 yuan / vehicle.

Risk tips:

Price competition beyond market expectations, raw material prices are unstable, affecting profit margins investment growth decline and the impact of epidemics.