01/21/2022

Great Wall Motor (601633) Comment: Stable Development of Equity Incentive Budget Is Expected

Great Wall Motor (601633) Comment: Stable Development of Equity Incentive Budget Is Expected
Event: On January 31, the company released the 2020 Expansion of Stocks and Stock Budget Incentive Plan (planned), and plans to grant a total of 17,834 equity to 1,966 employees.990,000 shares, the underlying stocks are A shares of common stock, which demonstrates the company’s confidence in the long-term development. Equity allocation and budget incentives are mainly targeted at key employees and restrict core employee interests.The plan grants approval for stock 6844.09 million copies, granting a stock budget of 10,990.900,000 shares, the ratio of the first grant and supplement of stock and budget is 8: 2, and the first restricted stock grant price is 4.37 yuan / share, the first time the budget exercise price granted is 8.73 yuan / share.Mainly for core executives, core management / technical staff, directors of some subsidiaries, a total of 1966 people.The initial stock incentives were for the first time targeted at 4 executives and 3 executives of subsidiaries, and 287 were core management / technical personnel; for the first time, they were targeted at 1672 core management / technical personnel.The incentive plan binds the core employees’ interests and helps the company’s development. The restrictions on sales 杭州桑拿 and exercise were lifted to evaluate sales and net profit indicators at the same time, showing development confidence.The first grant of stock and budget will be unlocked in 3 years, and the supplement will be unlocked in 2 years.Unlocking conditions simultaneously measure sales (65% weight) and net profit (35% weight), and require Σ (actual achievement value of the performance indicator / target performance indicator value) × performance indicator weight = combination performance coefficient ≥1.The sales target for 2020-2022 is no less than 111/121 / 1.35 million vehicles, and the net profit is no less than 4.7 / 50 / 5.5 billion yuan.It shows the company’s confidence in future sales growth and steady development. Sales surpassed the industry, Great Wall Artillery performed well, and looked forward to the switch of the new platform, maintaining the level of “prudent increase”.Since the reform in 19 years, the company’s sales volume has continuously surpassed the industry. In 19Q3, the company’s profitability improved due to cost reduction and efficiency improvement, and its single-quarter gross margin recovered to 18.5%, +4 from the previous quarter.9 points.In the future, as pickup truck sales continue to climb, the introduction of Euler R2 and two new SUVs, and 20 years of new power platform products to improve profitability and competitiveness, the company’s performance is expected to grow steadily.It is estimated that the company’s net profit attributable to the parent in 2019-2021 will be 45.7/48.9/53.50,000 yuan, maintaining the level of “prudent increase”.Risk warning: the industry’s sales volume has grown significantly; the company’s new car sales exceed expectations;