Performance is seriously "biased" and the market outlook is under pressure. BAIC New Energy plans to acquire a backdoor listing to become the "first stock of new energy vehicles" in the A-share market.

Recently, Chengdu Qianfeng Electronics Co., Ltd. (hereinafter referred to as "SST Qianfeng", 600733.SH) announced that the company's issuance of shares to Beijing Automotive Group Co., Ltd. and others to purchase 100% of the equity of Beijing New Energy Automobile Co., Ltd. (hereinafter referred to as "BAIC New Energy") has been approved by the China Securities Regulatory Commission. The China Securities Regulatory Commission also approved its raising of supporting funds of no more than 2 billion yuan. This means that BAIC New Energy's backdoor listing has entered the actual operation stage.

As the first company in China to obtain the qualification to produce new energy vehicles, BAIC New Energy has certain advantages in the field of pure electric vehicles in China. However, observing the company's sales in recent years, although the low-end EC series products are firmly at the top of the pure electric vehicle sales list, the sales of the high-end EU series, EV series, and EX series are not satisfactory. In the current situation where new energy subsidies are declining, how to deal with it has become a major problem after its listing.

Regarding when the listing will be completed and how the company will avoid risks in the future, a reporter from China Business News called and wrote to BAIC New Energy, and a person from its public relations department said that the relevant questions would be forwarded to the secretary of the board of directors. As of press time, no response has been received.

The launch date is expected to be advanced to June

Public information shows that BAIC New Energy was established in 2009 and is the main platform of BAIC Group responsible for the production and sales of new energy vehicle products. As early as the Beijing International Auto Show in late April this year, Xu Heyi, chairman of BAIC Group, clearly stated that BAIC New Energy will be listed in the third quarter of 2018. Now according to market news, the listing time is expected to be advanced to June.

According to the plan approved by the China Securities Regulatory Commission, 100% of BAIC New Energy's equity was injected into the listed company SST Qianfeng at a price of 28.85 billion yuan, and all of SST Qianfeng's assets and liabilities were sold at a price of 187 million yuan, which was exchanged for the equivalent portion of BAIC New Energy shares held by BAIC Group. The asset price after the offset was 28.662 billion yuan, and SST Qianfeng issued 761 million shares at an issue price of 37.66 yuan per share to 35 counterparties including BAIC Group, Daimler Greater China Investment, CATL, and Pangda Auto Trade Group.

After the completion of this transaction, SST Qianfeng will transform from a company mainly engaged in real estate development and sales to a company mainly engaged in the research and development, production, sales and service of new energy vehicles and core components. In addition, the China Securities Regulatory Commission also approved SST Qianfeng's non-public issuance of shares to raise supporting funds of no more than 2 billion yuan, which, after deducting the fees of relevant intermediary institutions, will be used entirely for the Beijing New Energy Innovation Technology Center project, the BAIC New Energy C35DB model project, the BAIC New Energy N60AB model project, and the BAIC New Energy N61AB model project.

SST Qianfeng previously disclosed that the C35DB model project is a "high-quality Cross hatchback pure electric vehicle" positioned in the A0 class, focusing on styling, space, mileage and configuration; the N60AB model project is an A+ class new platform SUV; the N61AB model is positioned as an A+ class innovative sedan Cross model. At present, BAIC New Energy has a total of 8 models on sale, including the three-box sedans EU260, EU400 and EH300, the two-box sedans E150EV, EV160, EC180 and EC200 and the small SUV EX260.

"Being able to go public should be said to have certain positive effects on BAIC New Energy's acquisition of funds, continuous research and development, and improvement of product technology content." Yan Jinghui, expert consultant of the All-China Federation of Industry and Commerce Automobile Dealers Chamber of Commerce, believes that new energy vehicles are not only the focus of BAIC New Energy's development, but also the focus of the entire BAIC Group. Therefore, after going public, it will be of certain help to the improvement of the overall brand of BAIC Group.

It is reported that after BAIC New Energy is listed, all subsidiaries of BAIC Group, including BAIC Motor and BAIC Foton, will be listed. According to the plan previously disclosed by Xu Heyi, under the general framework of comprehensive new energy, BAIC Group will combine the reform of state-owned enterprises and the adjustment of its own business structure to eventually realize the path of groupization. In the future, both A shares and H shares of BAIC Group's vehicle business segment will be connected to achieve comprehensive capitalization and securitization.

The risk of "addiction" to low-end models is hidden

According to data disclosed by SST Qianfeng, in the first 10 months of 2017, BAIC New Energy achieved a total operating income of 7.377 billion yuan and a net profit of 39.244 million yuan; in 2016, BAIC New Energy achieved an annual revenue of 9.372 billion yuan and a net profit of 108 million yuan.

In terms of sales, BAIC New Energy is currently in a leading position in the field of pure electric vehicles in China. In 2016 and 2017, BAIC New Energy sold 52,200 and 103,200 pure electric vehicles respectively, with a domestic market share of 20.63% and 22.99% respectively.

According to the sales data of new energy vehicles in April released by the China Passenger Car Association, the sales of new energy passenger vehicles in April reached 73,000 units, a month-on-month increase of 31% and a year-on-year increase of 150%. Among them, the sales of BAIC New Energy EC series in April were 7,471 units, a year-on-year increase of 72%, firmly sitting at the top of the pure electric vehicle list.

However, while the EC series products have exploded in sales, the sales of its high-end EU series, EV series, and EX series are not satisfactory. The company is highly dependent on the EC series models. According to statistics from China Railway Network, the retail sales volume of the EC series sold by BAIC New Energy in 2017 accounted for as high as 79%. In April this year, the retail sales volume of EC series models accounted for 98.5%. Once the sales volume of EC series products fluctuates, it may have an impact on the company.

It is understood that the BAIC New Energy EC series belongs to the A00-class electric vehicles, which are positioned at the low end and are relatively cheap. During the first 10 months of 2017, the average price of each vehicle after subsidies was only more than 40,000 yuan. However, our reporter noticed that in order to further stimulate the development of new energy vehicles in a better and more optimal direction, the Ministry of Finance previously issued a new subsidy standard for 2018, which will be implemented from June 12. According to the new subsidy standard, EC180 will have almost no subsidy, and BAIC New Energy may be greatly affected.

In addition, in the second half of this year, new car-making companies such as NIO, WM Motor, and Xpeng will see their first product deliveries, and foreign brands such as Volkswagen, Ford, and Nissan have also entered the market. This puts considerable pressure on BAIC New Energy to maintain its sales advantage in the new energy vehicle field.

"Competition is inevitable. It mainly depends on how BAIC New Energy responds. It is important whether it can learn from the strengths and make up for the weaknesses of the new car-making forces." Yan Jinghui said.

As a winner of Toutiao's Qingyun Plan and Baijiahao's Bai+ Plan, the 2019 Baidu Digital Author of the Year, the Baijiahao's Most Popular Author in the Technology Field, the 2019 Sogou Technology and Culture Author, and the 2021 Baijiahao Quarterly Influential Creator, he has won many awards, including the 2013 Sohu Best Industry Media Person, the 2015 China New Media Entrepreneurship Competition Beijing Third Place, the 2015 Guangmang Experience Award, the 2015 China New Media Entrepreneurship Competition Finals Third Place, and the 2018 Baidu Dynamic Annual Powerful Celebrity.