2024Q1, the revenue and profits of listed tire companies have basically increased year-on-year. This is mainly due to the steady improvement in domestic demand, and overseas demand was disrupted by inventory removal during the same period in 2023.
The Zhitong Finance App learned that Cinda Securities released a research report stating that the 2023 and 2024Q1 results were released, and tire companies' revenue and profits showed a positive trend. In 2023, Sailun Tire's revenue (25.978 billion yuan) and net profit after deduction ($3.146 billion) ranked first. Morikirin's revenue had the highest year-on-year growth rate (24.63%), and GM shares had the highest year-on-year net profit growth rate (2733.55%), turning a loss into profit and a marked improvement in profit, and Qingdao Double Star achieved a loss reduction. 2024Q1, the revenue and profits of listed tire companies have basically increased year-on-year. This is mainly due to the steady improvement in domestic demand, and overseas demand was disrupted by inventory removal during the same period in 2023. Key targets: Sailun Tire (601058.SH), GM Co., Ltd. (601500.SH).
The main views of Cinda Securities are as follows:
US market: Sales of US auto parts and tire stores have maintained a high year-on-year growth trend. Gasoline and diesel consumption and automobile sales are relatively stable. Overall, downstream tire demand is relatively stable. In March 2024, retail sales of US auto parts and tire stores were US$11.870 billion, up 5.00% year on year. In April 2024, US gasoline consumption was 8.5788 million b/day, down 3.57% year on year; diesel consumption was 3.473 million b/day, down 8.24% year on year; US car sales were 1.3357 million units, down 1.58% year on year.
US import market: In March 2024, the number of PCRs imported from the US was 176.367 million, up 4.73% from the previous month, up 9.64% year on year; the number of TBRs imported from the US was 1.82 million, down 0.25% from the previous month, up 19.60% year on year. Cinda Securities believes that fluctuations in shipping caused disturbances in US imports from 2022 to 2023 (storage first, storage later). Since the second half of 2023, US import demand has returned to a normal rhythm; since 2024, US monthly imports have all been at a high level in the same period in history, and demand for US tires is still stable.
Chinese market: Domestic demand is relatively stable, and the commencement of semi-steel tires is still high. In April 2024, China's heavy truck sales volume was about 87,000 units, down 24.87% month on month, up 4.69% year on year; China's logistics industry sentiment index was 52.40%, up 0.90 pct month on month, down 1.40 pct year on year; average monthly operating rate of all steel tires was 66.91%, down 0.37 pct year on year and 3.04 pct month on month; average monthly operating rate of semi-steel tires was 79.96%, up 7.36 pcts year on year and 0.62 pct month on month.
Raw materials: The average price index for tire raw materials rose slightly in April, but showed a downward trend in April. In April 2024, the tire raw material price index was 170.75, up 0.37% month-on-month and 6.27% year-on-year. Among them, the average price of natural rubber was 13,930 yuan/ton, up 0.65% from the previous year, up 20.88% year on year; the average price of styrene butadiene rubber was 13,409 yuan/ton, up 1.16% from the previous month and 15.55% year on year; the average price of carbon black was 9,173 yuan/ton, up 0.95% month on month and 0.58% year on year.
Risk factors: the risk of falling demand due to the macroeconomic downturn; the risk of rising raw material costs or falling product prices; the risk that economic expansion policies fall short of expectations.