"Currently, the valuation of the domestic automotive industry uses SAIC Group as a benchmark. Before coming here, I checked SAIC Group's stock price, which is currently around 3.5 yuan. Calculated by their total share capital, their market value is around 11.5 billion yuan."
During the lunch break, it was still the leader knowledgeable in finance, educating Tan Jincheng about automotive industry valuations.
Tan Jincheng was relatively lacking in financial knowledge.
Although his business in his previous life was passable, when it came to financial knowledge, he was just a novice.
After dabbling in A-shares and getting beaten by Zhongguo Ping'an, he became more cautious.
Shanchi Technology will definitely go public to raise funds in the future, and Tan Jincheng still has a lot to learn about industry valuations.
Therefore, whenever there's an opportunity, Tan Jincheng learns from people who understand this aspect of knowledge.
It's not systematic, but given his current busy work schedule, he can only use this method to gradually broaden his knowledge.
Once his business is on track, Tan Jincheng also plans to enroll in a class to study.
This leader also appreciated Tan Jincheng's eagerness to learn, patiently teaching him as if he were a junior.
"3.5 yuan? 11.5 billion? Is SAIC's valuation that cheap?"
Tan Jincheng asked, somewhat surprised.
He hadn't checked SAIC's total share capital and didn't know it, but he did know about the 11.5 billion yuan valuation, and he also knew that SAIC Group's market value would reach 150 billion yuan over a decade later.
"Holy crap! This is a business opportunity, a tenfold surge! This is better than losing money on Maotai. I need to find a chance to hoard some. 3.5 yuan is way too cheap."
The leader said with a wry smile,
"There's nothing we can do. Everyone knows the automotive industry is a big industry. A valuation of 11.5 billion yuan is indeed ridiculously cheap, but don't let the booming domestic car market of recent years fool you; we still can't shake the foreign brand market."
There was something he found hard to say: the history of official vehicle changes is actually the best reference for our country's automotive industry, from the earliest Eastern European brands, then Nissan brands, and then transitioning from Santana to the current Audi, it has always been foreign brands.
There were no domestic brands, and this largely stemmed from a sense of helplessness.
Our automotive industry was truly suppressed for decades.
Fortunately, with the arrival of the new century, domestic cars began to flourish.
Although there are no particularly prominent brands yet, it is believed that in the near future, our own brands will also appear in official vehicles.
"Then what kind of valuation should we give Zhongtai?"
Tan Jincheng understood the leader's wry smile, but it wasn't appropriate for him to respond to that, nor was he qualified to.
In his previous life's memory, Zhongtai's highest market value was 30 billion yuan.
At this point, its cars haven't even been released, so it's really hard to estimate.
However, with SAIC Group's 11.5 billion yuan benchmark, there's a good reference point.
Can you be more impressive than SAIC?
How many billions was Zotye when it went public via a backdoor listing?
Was it 6 billion?
But that was 10 years later.
Moreover, it was using its parent company's shell for the listing.
A father buying from his son, the price would definitely be inflated.
On the other side, Ying Jianren and Wu Jianzhong were also discussing.
Ying Jianren sighed,
"It's difficult. The key is that our product hasn't been launched yet. Even if we say we're optimistic about the market and it will sell well, it might not sell at all. So, this valuation is really hard to calculate."
It could be said that Zhongtai is worth billions, or that it's worthless.
The problem is, they currently need car qualifications and this cooperation, and the other party has also come with sincerity.
This makes it a difficult decision.
"Indeed, it's hard to value. So, it's best if we don't name a price ourselves. Let them make an offer, and then we'll discuss. Do you want to try to get more information from that young man?"
"It's a bit difficult. That young man is very tight-lipped. I chatted with him all morning, but got nothing out of him except his intentions for this visit."
Ying Jianren shook his head, then added,
"He told me that the conditions for acquiring that brand involved spending 30 million yuan, and also investing in building a factory in his hometown. I don't know if it's true or false. Brother-in-law, do you want to use your connections to inquire?"
Wu Jianzhong also shook his head,
"We could find out, but there's no time for that now. However, the 30 million yuan figure is likely false; it's probably meant to deceive or test you."
"I think so too, but the expenditure is definitely in the tens of millions. This kid is really shrewd; I couldn't get a single word out of him all morning."
"That's normal. People in Beicang District seem to value him highly. If he didn't have some real skills, even with a strong background, it wouldn't be like this."
He had seen many young people with backgrounds, but those who commanded respect were invariably capable.
Especially in important matters like attracting investment, a district government wouldn't casually heed someone's opinion unless their suggestions were highly constructive.
"Then it's settled. Let's start negotiations directly this afternoon. Let the other party make an offer, and if it's reasonable, we'll finalize it."
Ying Jianren was tired after running around for several months and was eager to settle it a day earlier.
Wu Jianzhong looked at his brother-in-law, smiled, and said nothing.
He fully understood this feeling; with all their assets tied up in this car, settling it a day earlier would indeed bring much more peace of mind.
He himself was no different.
——
"The automotive industry belongs to discretionary consumption. It is itself a daily consumer good but also has the nature of discretionary consumption, with certain cyclicality. From a global perspective, vehicle ownership is a very important indicator."
"From a global perspective, worldwide vehicle ownership has reached 45 million units. Some developed countries in Europe and America are already nearing the situation after high growth, so the valuation of automotive manufacturers won't be very high; some are even fundamentally lower than the valuation of parts suppliers."
"However, our nation's situation is somewhat different. We are considered an emerging market, and vehicle ownership is still very low, with significant room for growth in the future. Xiao Tan, if you're interested, you could buy some automotive stocks; I think there should be good returns in the future."
After interacting for a while, the leaders became quite familiar with Tan Jincheng, and their private conversations were less formal.
This finance leader had previously heard Leader Gu joke about Tan Jincheng's stock trading, supposedly stuck with losses.
Stocks are always an unavoidable topic in finance.
Although it was just a simple tease, he remembered it and couldn't help but bring it up to tease Tan Jincheng, and incidentally, offer a piece of advice.
"Alright, I'll buy SAIC Group when I get back,"
Tan Jincheng nodded repeatedly.
Even if you didn't say it, I'd still buy it.
I should thank you for mentioning SAIC.
Otherwise, Tan Jincheng, who wasn't very familiar with A-shares of this era, might have just focused on Maotai and other liquor stocks.
After all, many A-share companies have undergone multiple name changes, and even with a good memory, one wouldn't know a stock's historical name unless they were particularly familiar with it.
Unless one has a special understanding of its fundamentals.
Newbie investors look at fundamentals?
Nonsense, just get a code and do it!
"Haha, I just said that. Don't go wild; if you lose money, I won't compensate you. Besides, I can't afford to."
"How could that be? You're teaching me. Normally, I can't even find someone like you to guide me. In the future, I'll have to consult you frequently."
Tan Jincheng also wanted to buy stocks in Maotai, QQ, and Yongcheng Bank.
Now there's SAIC Group, and he might recall others in the future.
Plus, he has so many properties.
It seems that for personal investments, he should find someone to manage them for him.
If it comes down to it, these investments will also amount to a considerable sum in the future, and they really need professional management.
The manager doesn't need to be exceptionally brilliant, just have some basic knowledge, but must be absolutely trustworthy.
"Damn, no wonder protagonists in web novels like to have harems so much. A person by your side managing some private businesses is definitely more trustworthy,"
Tan Jincheng couldn't help but think nonsensically.
Never mind, Kun'er couldn't handle it.
He'll endure a few years first.
When his younger siblings grow up, handing it over to them to manage would be the same.
Tan Jincheng is clear about their character.
"No problem. I'll find you a few books after I go back; you can read them when you have time. Your business is growing, and you really should learn more. My suggestion is that when you have time, you can audit classes at Yongcheng University. Getting an auditing qualification shouldn't be hard for you, and conveniently, your girlfriend is also from Yongcheng University."
"Okay, I've noted that. Thank you for your guidance."
"It's not about guidance. You are an excellent young man, and you act with a lot of conscience. I admire you simply for paying social security for all your company's employees. Many families will likely thank you for this in the future."
The praise was too high, making Tan Jincheng a bit embarrassed:
"Isn't this just what should be done? Besides, I only pay the minimum level; it's not as exaggerated as you say."
"It's already very commendable. You have to eat your food one bite at a time. And don't underestimate your act of paying social security for all employees. When your company gains more influence in Beicang, other companies will follow suit. This can be considered a driving force."
In this era, very few private enterprises voluntarily paid social security.
One reason why university students were unwilling to work for private enterprises was precisely this.
And because society was in a period of rapid development, the entire nation was busy making money at this time.
Such matters were largely in a default state.
In fact, this was a negative phenomenon: without benefits, excellent talent couldn't be attracted, and without excellent talent joining, there would be no competitiveness.
At a certain stage of development, there would definitely be disadvantages.
"Returning to Zhongtai's valuation, the timing you've chosen is very good. Their cars haven't been launched yet. Discussing cooperation for equity now gives us a certain advantage because the product hasn't been market-tested."
"Using SAIC as a benchmark, and looking at the current situation of other domestic car companies like Chery, Geely, BYD, etc., at this stage, I think a valuation of around 2 billion yuan for Zhongtai is more reasonable. A bit higher is acceptable, but it shouldn't exceed 3 billion yuan."
After listening, Tan Jincheng had a rough idea in mind: between 2 and 3 billion yuan.
If it's a branch company, it could be a bit less, which would make negotiations easier.
(End of Chapter)