Automotive Industry: Overall Listing Increases Value


At present, listed companies in the automotive industry (especially vehicle companies) are mostly marginal assets of their respective groups. Listed companies do not really represent the level of industry development. By injecting high-quality assets of the Group into listed companies through asset injection and other methods, the listed companies will have greater impetus for future development and a more complete industrial chain, and the status of listed companies in the Group will be further strengthened. At the same time, it reduced associated transactions and improved profitability, giving investors more confidence and boosting the stock price.

A joint research report from the United States pointed out that it is expected that in 2007 China’s original production of automobiles will exceed Germany and become the third largest in the world; by 2015, China will surpass the United States and become the world’s largest producer. At present, the total output of Chinese cars is less than that of the U.S. General One. In the future, the domestic market will usher in a climax of capacity expansion. In addition, the R&D and production of independent brands also require large amounts of capital. Such a huge amount of capital demand cannot be solved simply by the company's own working capital. Raising funds from the A-share market will become an inevitable choice.

The overall market opportunity for the automotive industry has become a hot topic in the market. The listing of quality assets of the Group will substantially increase the value of the company's investments.

Concerned about the company: Dongfeng Motor (Quote Forum) (600006)

As a central state-owned enterprise, Dongfeng Motor (Group) Group has the possibility of listing its entire A shares in Dongfeng Motor under the promotion of policies. The relationship between Dongfeng Motor Group and Dongfeng Motor is similar to that of Weichai and Hunan Torch. Therefore, the return of Dongfeng Group to A-shares may adopt a similar swap-and-share scheme with Weichai to achieve the overall listing of A shares.

In the future, if Dongfeng Group achieves the overall listing of A shares through Dongfeng Motor, the scale of assets of Dongfeng Motor will expand rapidly, the industrial chain will be more complete, and the market share and profitability will be further improved.

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