The main reason for the large increase in revenue in the first three quarters of the CATL is the rapid growth of the new energy vehicle market

On the evening of October 25, CATL disclosed its first three quarterly reports after listing. The company achieved operating income of 19.136 billion yuan in the first three quarters, a year-on-year increase of 59.85%; realized net profit of 2.379 billion yuan, a year-on-year decrease of 7. 47%; net profit after deduction was 1.985 billion yuan, a year-on-year increase of 88.71%.

The main reason for the large increase in revenue in the first three quarters of the CATL is the rapid growth of the new energy vehicle market

Ningde era financial report data for the first three quarters

Ningde Times stated in the third quarterly report that the main reason for the large increase in operating income was the rapid growth of the new energy vehicle market; the company strengthened market promotion and increased its market share.

According to the data compiled by the Xiaobian Research Institute, from January to September 2018, my country’s cumulative production of new energy vehicles was 666,000, an increase of 35% year-on-year; the total installed power of power batteries in the first September was about 28.87GWh, an increase of 94% year-on-year . Among them, CATL ranks first with 11.7GWh installed capacity, accounting for more than 40% of the market share.

However, while revenue has soared by nearly 60%, the net profit of CATL has declined in the first three quarters. What is the reason behind "increasing revenue but not profit"?

In the three-quarter report previously released, CATL pointed out that the main reason for the decline in the performance of the first three quarters compared with the same period of the previous year was the impact of disposal gains from the transfer of equity in Beijing Pride in the same period last year. At that time, CATL transferred 23% of its subsidiary Pride and confirmed an investment income of 1.034 billion yuan.

After deducting the impact of the disposal income from the transfer of Pride and other non-recurring profit and loss items on performance, CATL achieved a non-net profit of 1.985 billion yuan from January to September 2018, a year-on-year increase of 88.71%.

In addition, CATL also disclosed the progress of important matters in the third quarterly report: On July 26, it signed a purchase order of 815 million with BMW Brilliance, and the latter prepaid 2.85 billion in advance. Under certain circumstances , BMW Brilliance has the right to make equity investments in the company; on July 19, the company and Guangzhou Automobile Group signed a joint venture agreement, and the two parties plan to jointly fund the establishment of Times Guangzhou Automobile Power Battery Co., Ltd. and Guangzhou Automobile Times Power Battery System Co., Ltd. in Guangzhou. It needs to be submitted to the Development and Reform Commission where the project is located for approval and anti-monopoly approval, and is currently being implemented in an orderly manner.

For CATL, 2018 is undoubtedly the most important year in its development. On June 11 this year, CATL IPO as a unicorn in the A-share market, with the highest market value exceeding 200 billion yuan. In this regard, some analysts believe that as the only domestic company that is regarded as a competitor by Japanese and Korean companies, the growth of CATL can be described as the right time and place. In 2017, it surpassed Panasonic to become the world's largest power battery company. More importantly, CATL has achieved the integration of the entire industry chain through capital and other means in upstream resources, midstream materials, downstream vehicles, and recycling. However, with the gradual opening of the domestic market, CATL’s real competitors will be Japanese and Korean companies. The large size does not mean that they are leading in technology and products. CATL can only stand forever if it continues to increase research and development and make products. Invincible, otherwise, once the policy umbrella is cancelled, it may be short-lived.

The editor found that as of the close of trading on the 26th, the stock price of CATL fell 7.8% to close at 74.6 yuan.

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