Wanliyang (002434) Comment on Important Issues: Joining Bosch to Transform Technology Advantages

On the afternoon of January 15, 2020, the company announced that it had signed a “strategic cooperation agreement” with Bosch Transition Technology Co., Ltd., and the two parties reached an agreement on cooperating in the development and promotion of CVT technologies and products that replace electric and hybrid vehicles, focusing more on automobiles.Transmission main business.

The company’s CVT products benefit from automatic gearbox upgrades and industry integration, with abundant orders in hand and rapid market share gains. The technological advantages of emerging products such as E-CVT continue to be consolidated, maintaining a “buy” level.

   Teamed up with Bosch Transmission to develop E-CVT.

The company announced that it had signed a “strategic cooperation agreement” with Bosch Rapid Technology Co., Ltd. The two parties reached an agreement on the development and promotion of stepless conversion of electric and hybrid vehicles (ECVT and CVT-based HEV, PHEV hybrid transmission) technologies and products.Consensus.

The signer of this strategic agreement, Bosch Transition Technology Co., Ltd. is the world’s leading supplier of CVT steel strip products. Signing the strategic cooperation agreement will further strengthen the cooperation relationship between the two parties in the field of CVT.

The company’s E-CVT new product technology and mass production levels are leading domestically, and in-depth cooperation with Bosch will help the company to further maintain the technological leadership of new products.

   The commercial vehicle business is stable, with solid cash flow.

The company is a domestic commercial vehicle transmission leader, covering different models of light trucks, medium trucks and heavy trucks. It is conservatively estimated that the company’s commercial vehicle conversion light truck industry market share is about 35%, and the Chinese truck industry market share is about 75%.

The absolute merger of the company in the commercial vehicle market has ensured another stable profitability. The gross profit margin of light truck and heavy truck transfer business has remained above 25% year-on-year, and it is 28 in 2019H1.

8% and 30.

6%, a significant pick-up.

Since 2012, the company’s operating net cash flow has basically remained above 2 ‰, and its cash flow is stable.

The company’s commercial vehicle products are still continuously upgraded. The company has developed the G series of high-end light trucks for the national six emission standards, and is currently in the rapid ramp-up phase. The 16G220 medium-heavy truck transportation products have received more customer orders.

   Continuous independent research and development, CVT achieved a breakthrough.

Since 2009, the company’s R & D expense ratio has remained at 3.

More than 5%, and 4 in 2017/18.

2% / 5.

9%, product development accelerated.

The company’s transition product pedigree has been continuously expanded, achieving a leap from commercial vehicles to passenger vehicles, manual transmissions to automatic transmissions, and the average product price has also increased from 1,865 yuan / set in 2015 to 2,800 yuan / set in 2018.

The company’s CVT automatic transmission product CVT19 has gradually completed the upgrade to CVT25 and CVT18 / 20, and the output size has been greatly improved, which can match engines with different displacements and powers.

Domestic mainstream independent brand OEMs such as Geely, Chery and BYD have begun to carry the company’s CVT products on a variety of models.

The company has plenty of future orders, and the last round of capital expenditure cycle is nearing its end. It is expected to start a new round of growth.

   Risk factors: The sales volume of the automobile market is lower than expected; the CVT penetration rate is lower than expected; the customer expansion is lower than expected.

   Investment suggestion: The company’s CVT products have made breakthroughs and there are plenty of orders in the future. It is expected to start new growth and maintain the company’s EPS forecast for 2019/20/21 to 0.



63 yuan, corresponding to PE is 24/15/14 times.

Considering that the company is a domestic commercial vehicle transmission leader with stable cash flow; breakthroughs in CVT products have directly benefited from changes in the competitive landscape of the domestic CVT industry; future orders are full, and orders from domestic mainstream brands such as Geely, Chery and BYD have been maintained, maintaining “buyTo “in” rating.