Text | Zhou South Tour
On the evening of August 30, Sailis Group joint stock company (hereinafter referred to as Sailis) released the 2023 semi-annual report. From January to June, the company achieved revenue of 11.032 billion yuan, a decrease of 11.14% year-on-year; deducting non-attributable net profit – 1.344 billion yuan, the loss decreased by 22.18% year-on-year. In addition, Sailis plans to promote the listing of Chongqing Ruichi Automotive Industry Co., Ltd., a wholly-owned grandson company of the company.
Three-year loss
Sailis, founded in 2016, formerly known as Chongqing Xiaokang Industrial Group joint stock company (hereinafter referred to as Xiaokang shares) is a technology-based manufacturing enterprise in Chongqing with new energy vehicles as its core business.
Over the past 20 years, Xiaokang shares have gained a place in the lower-tier market with brand cars such as Dongfang Xiaokang. With the revolutionary transformation of the automotive industry to electrification and intelligence that has not been seen in a century, the layout of new energy tracks has become inevitable.
In 2016, the predecessor of Cyrus, Jinkang New Energy Vehicle, was established. In 2020, Cyrus launched the first new energy vehicle, Cyrus 5, which was not welcomed by the market. It was not until 2021 that it joined forces with Huawei to launch the first cooperative model, Smart Choice SF5, and Jinkang New Energy Vehicle "became an instant hit".
The following year, Jinkang New Energy Vehicle renamed itself Cyrus and partnered with Huawei to launch the AITO new energy vehicle brand, targeting the high-end market.
With M5, EV and M7 models, it became a dark horse for the new forces of car manufacturing in 2022. That year, after the first new car in the world was launched, the monthly sales quickly exceeded 10,000, and in less than 10 months, the cumulative sales reached 75,000.
Q Jie series is a new energy brand jointly launched by Huawei and Cyrus, and it is also the core product of Cyrus.
According to the data, the cumulative production and sales of new energy vehicles of Sailis in 2022 were 130132 and 135054, respectively, an increase of 233.63% and 225.9% year-on-year. Among them, the production and sales of Sailis Automobile-Wenjie series cars were 83701 and 80041, accounting for more than half of the production and sales in 2022.
However, since 2020, Cyrus has been in a state of loss, accumulating more than 8.60 billion yuan. Since the beginning of this year, due to various factors, the sales volume of the world has continued to be sluggish, and the cumulative sales volume in the first five months has only 20,000 more than…
On July 15, Sailis announced that the net profit of non-return to the parent in 2023 is expected to be between – 1.93 billion yuan and – 1.80 billion yuan. The production and sales report data of the month is also not good. The sales of new energy vehicles decreased by 47.83% year-on-year, and the cumulative sales of 51,734 vehicles throughout the year decreased by 12.19% year-on-year.
In this regard, Sailis said that it was affected by the user wait-and-see sentiment caused by the overall promotion of the automotive industry in the first quarter of 2023, as well as the release of the M5 smart driving version in the second quarter.
However, Soochow Securities believes in the research report that the second quarter user wait-and-see mood fades, the release of the M5 smart driving version and the start of delivery will resonate and drive the second quarter sales.
As expected, the financial report shows that the sales of new energy vehicles in the second quarter increased by 24.30% compared with the previous quarter; revenue decreased by more than 20%.
Deepen cooperation and enrich product matrix with innovative technologies
With the launch of models such as the AITO M5 Smart Driving Edition and the new M7 Grand Five-Seater Edition, as well as the increase in overseas sales and the decrease in raw material prices, Sailis said that sales and profitability are expected to further improve in the second half of the year.
In fact, the poor data does not mean that Cyrus is inactive. Since the beginning of this year, Cyrus’s new products have been launched at an accelerated pace, and the product matrix has continued to enrich.
On May 27, AITO asked the 100,000 car in the industry to roll off the production line, and it became the fastest new energy vehicle brand to achieve this goal in 15 months. In June, the M5 smart driving version jointly designed by the company and Huawei started national delivery, taking the lead in realizing high-speed and urban high-level intelligent driving functions that do not rely on high-precision maps.
On August 26, the new M7 five-seat version made its debut at the Chengdu Auto Show and opened for small orders. It will be officially released and delivered on September 12. The car features a large space and flexible layout.
Previously, the company announced the signing of a deepening joint business agreement with Huawei and the establishment of a joint sales and service working group, adding another milestone to the long-term and in-depth cooperation between the two parties. Focus on strategic cities, optimize sales channel construction, and build a delivery and service network.
Establish strategic partnerships with leading suppliers such as Wencan and Bosch, as well as the China Automotive Center, to jointly promote the high-quality development of the industry.
In terms of research and development, Cyrus continues to maintain high investment in core areas and continues to attract professional talents.
As of June this year, the company had 3,741 authorized patents; from January to June, 315 new authorized patents and 1,058 new patent applications were added, maintaining an industry-leading advantage in the fields of system architecture, intelligent manufacturing, and product quality. During the reporting period, R & D expenses increased by 16% year-on-year.
It is worth mentioning that Sailis said in its semi-annual report that it plans to introduce one or more important partners in the industrial chain and industrial funds as investors through capital increase or equity transfer for its wholly-owned grandson company Chongqing Ruichi Automotive Industry Co., Ltd. at a price of not less than 10 yuan per 1 yuan of registered capital, and choose the opportunity to go public.
According to the financial report, Ruichi Electric was established in September 2003 with a registered capital of 200 million yuan and is registered in Fusheng Town, Jiangbei District, Chongqing.
As of the end of June, its total assets 2.007 billion yuan, net assets 449 million yuan; 2022 and the first half of 2023 respectively to achieve operating income of 2.76 billion yuan and 1.021 billion yuan, net profit of 130 million yuan and 2641.40 yuan.
Sailis said that Ruichi Electric focuses on the electric commercial vehicle business, which is separate from the company’s electric passenger vehicle business. This move can optimize the company’s strategic layout and business structure, further strengthen the financial strength of Ruichi Electric, accelerate its Product Research & Development, market and channel construction, and enhance its core competitiveness and sustainable development vitality.
