CFMOTO(SH:603129) Guotou Securities·2025-03-31 14:16Investment Rating - The report maintains an investment rating of "Buy-A" for the company [7]. Core Viewpoints - The electric two-wheeler industry is expected to experience high growth driven by the old-for-new policy, which opens up long-term demand [19][24]. - The industry structure is continuously upgrading, with significant potential in the high-end market [2][3]. - The company has a strong foundation in two-wheeler manufacturing, with robust R&D, product, and marketing capabilities [4][5]. Summary by Sections 1. High Growth Driven by Old-for-New Policy - The electric two-wheeler industry is significantly influenced by policies, with a forecast for high growth in 2025 due to the old-for-new subsidy program [19][24]. - The expected annual replacement demand is around 50-60 million units, alongside new demand, indicating a larger potential market [19][34]. - The new national standard slightly increases production costs but is not expected to suppress demand due to the essential nature of electric two-wheelers [26][27]. 2. Continuous Upgrade of Industry Structure - The electric two-wheeler market has historically faced issues such as limited range and slow charging, but advancements in technology are facilitating a shift towards high-end products [2][3]. - Companies like Niu and Ninebot have successfully tapped into high-end consumer demand, indicating a growing acceptance of premium products [2][3]. - The market share of high-end products (priced above 3500 yuan) is projected to increase from 5% in 2023 to 10-15% by 2028, with a corresponding CAGR of 18-28% [2]. 3. Industry Concentration Expected to Increase - The competitive landscape of the electric two-wheeler industry is currently dominated by three major players, with a CR3 of 62.6%, reflecting a 25 percentage point increase since 2019 [3]. - The industry is likely to see further concentration as leading brands leverage their channel and brand advantages [3]. - The high-end market is expected to flourish with various brands, including traditional manufacturers and new entrants, each carving out their niche [3][4]. 4. Strong R&D and Marketing Capabilities of the Company - The company has a deep accumulation of experience in two-wheeler manufacturing, with a strong ability to develop and market new products [4]. - The launch of the high-end electric motorcycle brand "Jike" has positioned the company as a leader in the high-end electric motorcycle segment [4][5]. - The company has expanded its offline store presence significantly, with over 800 stores as of March 2025, enhancing its sales capabilities [12][33]. 5. Accelerated Product and Channel Development - The company has seen a remarkable increase in electric motorcycle sales, with a 642.6% year-on-year growth in 2024 [12]. - The introduction of new products and the expansion of the product matrix are expected to drive further sales growth [12][5]. - The company is benefiting from a strong new product cycle in its electric bicycle segment, with significant consumer interest in new models [12][5].