## 📊 Investment Summary: BYD Company Limited (BYDDY)

$1211 (-0,87 %)

Let me know your thoughts, guys.

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### 1. 🔍 Key Insights

- **Market Leadership**: BYD is the world’s leading NEV (New Energy Vehicle) manufacturer with vertical integration from battery production to vehicle assembly.

- **Durable Moat**: Strong cost control, R&D intensity (~100k engineers), and global expansion (Europe, Japan, Africa).

- **Financial Resilience**: Low leverage, high ROIC, and strong interest coverage despite high CapEx.

- **Valuation Premium**: Trades above traditional automakers, reflecting growth expectations.

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### 2. 🧩 Core Evaluation Areas

#### **Valuation**

- **P/E (TTM)**: 24.6

- **EV/EBITDA**: 9.88

- **FCF Yield**: 2.17%

- **DCF Implied Value**: ~¥300/share

- **Margin of Safety Price**: ¥240/share

- **Current Price**: ~¥356/share

#### **Growth Potential**

- **Revenue CAGR (5Y)**: 35.5%

- **Dividend CAGR (5Y)**: ~20.1%

- **Expansion**: Entering South Africa, Japan, Europe, and scaling exports.

#### **Operational Efficiency**

- **ROIC**: 13.4%

- **WACC**: 11.9%

- **CapEx / FCF**: 4.67 → High reinvestment mode

- **Margins**: Gross 19%, Net 5.7%

- **ROE**: 23%, **ROA**: 4%

#### **Risk Factors**

**Company-Specific (Moderate):**

- High CapEx may suppress FCF short-term.

- Revenue reliant on Chinese subsidies.

**Market/Systemic (Moderate–High):**

- EV price war (Tesla, XPeng).

- Exposure to rates, FX, and policy shifts.

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### 3. 📈 Supporting Metrics & Comparisons

| Metric | BYD | Tesla | NIO |

|---------------|-----------|-----------|------------|

| Market Cap | $150.8B | $574.3B | $8.4B |

| ROIC | 13.4% | 17.5% | Negative |

| FCF (2024) | ¥23.26B | ~$3.6B | Negative |

| P/E (TTM) | 24.6 | 73.8 | N/A |

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### 4. 📉 Projections and Scenarios

- **Base Case**: 15–20% top-line growth, FCF expands slowly.

- **Downside**: Margin compression from price competition.

- **Upside**: Strong global rollout and innovation edge.

*Note: Scenarios based on stated assumptions—limited forward disclosures.*

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### 5. ⚠️ Risk Assessment & Categorization

| Risk Type | Level | Notes |

|-------------------|-----------|---------------------------------------------|

| Execution Risk | Moderate | Aggressive CapEx and global rollout pace. |

| Financial Risk | Low | Debt low; interest covered 20x+. |

| Regulatory Risk | Moderate | EV incentives; geopolitical dependencies. |

| Competitive Risk | High | Intense pricing from Tesla/legacy OEMs. |

| Macro Risk | Moderate | Input cost, FX, and demand variability. |

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### ✅ Conclusion & Recommendation

- **Intrinsic Value Estimate**: ¥300/share

- **Target Buy Range (20% MoS)**: ¥240–¥270

- **Current Price**: ~¥356

- **Conviction Level**: 3.5/5

**Summary**: BYD is a fundamentally strong company with a wide moat, disciplined management, and long-term tailwinds. However, current pricing reflects full growth optimism. Wait for a pullback or improved FCF conversion before initiating or adding.

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