AutoBeta(AutoBeta.net)08/24 Report--

On August 24, Dongfeng Automobile Group Co., Ltd. (hereinafter referred to as "Dongfeng Group shares") issued a profit warning announcement showing that the net profit of Dongfeng Group shares in the first half of this year is expected to decrease by about 60% compared with the same period last year. Affected by the news, Dongfeng Group shares closed down 1.46% at HK $5.33.

As for the reason for the sharp decline in net profit, Dongfeng Group shares said that the COVID-19 epidemic at the beginning of the year affected the business operations and consumer expenditure of Chinese enterprises, while Dongfeng Group shares were at the center of COVID-19 's epidemic. The impact of the epidemic became more and more obvious in the first quarter and the overall resumption of work and production was a month later than the industry, resulting in a decline in Dongfeng Group's efficiency.

However, Dongfeng Group shares said that with the slowdown of the epidemic since the second quarter, the production and operation of each base of Dongfeng Group has gradually returned to normal, effectively alleviating the trend of declining efficiency in the first half of the year.

According to the financial report, the cumulative sales of Dongfeng Group shares fell 46.36% to 362600 vehicles, operating income fell 33.72% to 2.117 billion yuan, and net profit fell 124% to 27.6466 million yuan in the first quarter.

The sharp drop in net profit is most directly reflected in sales. Data show that cumulative sales of Dongfeng Group shares fell 16.73 percent to 1144485 vehicles in the first half of this year, including Japanese brands Dongfeng Nissan and Dongfeng Honda down 17.32 percent and 16.95 percent, French brands DPCA and Dongfeng Renault down 63.13 percent and 84.57 percent, and independent brands Dongfeng Qichen's favorite 17.32 percent.

At present, the level of domestic consumption has returned to the normal level, and the sales of Dongfeng Group shares are gradually recovering.

Dongfeng Group's share sales rose 12.1 per cent to 248000 vehicles in July, while cumulative sales fell 12.7 per cent to 1.392 million vehicles from January to July. Of this total, Dongfeng Nissan rose 16.38 per cent to 93835, Dongfeng Honda rose 9.82 per cent to 81265, DPCA fell 68.43 per cent to 3545 and Dongfeng Qichen fell 38.58 per cent to 5003.

It is worth mentioning that, in order to raise funds, Dongfeng Group shares also plan to land on the Kechuang board. Dongfeng Motor Group Co., Ltd. announced on July 27 that in order to further improve the corporate governance structure and build a financing platform at home and abroad, it plans to apply for an initial public offering of RMB common shares (A shares). And listed on the gem of the Shenzhen Stock Exchange.

Industry insiders said that in the context of the overall market recovery in the second half of the year, Dongfeng Group share market valuation has the opportunity to improve. In the medium to long term, with the listing of Dongfeng Group's return to Kechuang Board, it will receive additional funds for the development of its new energy passenger vehicles.

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