NIOtime #10: Is 420 really ten times better than 42?
Technical Chart. Media News Recap. NIO App Stories. All from a group of NIO global fans exclusively for the NIO community.
Bravo, we have 296 new members to join us on board to grow together with NIO! That’s up 44% WOW user growth. If you’re reading this but haven’t subscribed, we invite you to join the 955 NIOtime community by subscribing here! We are near the 1,000 member club.
Dear NIOtime family,
It’s NIO time, Blue Sky is Here!
Happy Friday! As you may notice on social media, Elon Musk tweeted earlier saying, “420 is ten times better than 42”. Media reported Elon Musk might infer 42 to NIO, which has caught Elon Musk’s attention on the recent NIO crazy stock rally and EV rivalry in China. We see this as a positive take for NIO because Elon Musk is kind enough to offer free publicity for NIO. This puts NIO on the world’s attention and under closer examination for potential investors or short sellers.
Here’s our response to his tweet regarding the rivalry between NIO and Tesla. In our opinion, this is good in general for EV automakers as Tesla finally has a competitor like NIO to push them penetrating the EV market even harder. In vice versa, all EV automakers including NIO are trying extra hard to catch up the first horse in this industry. As noted with Li Bin’s previous interview on Tesla, Li Bin’s tone is always respectful and credit on Tesla’s earlier contribution for pushing EV market in China. In addition, Li is confident in NIO by differentiating NIO from Tesla since beginning, not merely imitating Tesla like other auto makers but adapting to local market by providing the high-end user experience and power services.
In the words of basketball coach Mike Kryzewski: “Great rivalries don’t have to be built on hatred, they’re built on respect, a respect for excellence.”
Technical Chart
Bravo for all of us who long NIO together in which we observed roughly 36.36% upside for NIO within a week. NIO has a massive run up from $30.58 to $40.70 closed on market today. This is particularly due to the positive China government policy outline in the next 15 years for the EV sector as well as anticipation for the positive earning call which falls on 17 November 2020.
From technical chart, we see NIO is extended outside the upper bound of BB and far away from its EMA8 ($36.24) and EMA21 ($30.80). In fact, the stock price is at the high level for the short term after rallying from $25 zone up until now. We may be wrong and there could be another FOMO rally next week until the earning calls.
For long term investment, we long NIO since the beginning and would always examine the fundamental of NIO by checking our conviction from gathered news, NIO App community atmosphere, official facts and events. Cheers and invest safe.
This Week’s Top 7 Highlights by NIOtime
October Delivery Highlights (5055) vs. NIOtime Estimate (5187)
World Automakers Market Cap Overview- NIO ranks 6th
Citi, Deutsche Bank Analysts Rating Update
NIO Leads Battery Swap Standard in China
NIO Power Update : 158 (0) Power Swap & 75 (5) Power Charger
NIO House & Space Update: 22 (0) NIO House & 159 (2) NIO Space
NIO 100 kWh Battery Update
**We encourage NIOtime post sharing to let more people know about NIO. But please do credit @theniotime on your social media to appreciate our effort in gathering all highlights together for NIO global investors. Cheers and blue sky is coming! :)
News
October Delivery Highlights (5055) vs. NIOtime Estimate (5187)
NIO's October 2020 delivery highlights:
Delivered 5,055 units in October, doubling year-on-year and setting a new monthly high for the brand. The eighth consecutive month of year-on-year growth since March.
Reached the milestone of more than 5,000 units delivered in a single month in two years and five months since the ES8 started customer deliveries in June 2018.
NIO EC6 delivered 883 units this month, the first large-scale monthly delivery of EC6.
NIO delivered a cumulative total of 31,430 units in the first ten months of 2020, an increase of 111.4% year-on-year.
(News and Photos Source: NIO App)
Last week, we are confident to estimate NIO delivery at 5187 which off by 132 units with an accuracy of >99%. The second month straight estimated at an accuracy of >99%. The delivered 5050 unit monthly is indeed a milestone for China premium automaker as this is a quality and production proof of a rising EV brand in China as well as ready for global presence. We will continue to work on our estimate for November delivery.
World Automakers Market Cap Overview- NIO ranks 6th
First of all, congratulation to NIO which its current market cap surpasses that of GM, Ferrari and BMW. This is a relative big encouragement for NIO to keep doing what they are good at and improving what they are lacking of. The high automotive market cap indicates a series of tougher challenges with higher responsibility to keep the brand well position with the capital market expectation. We believe Li Bin and his team are capable to pull off the trigger and excel well in leading NIO to climb up in the leaderboard. We would see NIO becoming 2nd largest EV automaker after Tesla before 2025 provided they keep pushing their blue sky limit. Let’s bookmark this post on your browser and come back in 5 years later to check our prediction.
(Photo Source: Brandon, @brandude87)
Citi, DB Analysts Rating Update
This week, Citi analyst Jeff Chung raised his NIO price target by 40% to $46.60 from $33.20, keeping his Buy rating. The target is the highest on Wall Street and is 31% above Tuesday's closing price of $35.50. Meanwhile, Deutsche Bank reiterates NIO’s buy rating and increases the price target to $34.
Citi said it is optimistic about NIO based on the following factors: it benefits from strong order backlog and high margin visibility; its margin is expected to reach 13-16% in the third quarter and further to 22-25% in the fourth quarter; its increasing market share; decreasing battery costs, and it is expected to benefit from the favorable export-related policy.
It's also worth noting that Chinese investment bank CICC on Wednesday that the new energy vehicle sector's valuation has hit a new high, with BYD and NIO having become China's first and second-largest car companies by market cap. Valuations have stretched as the new Chinese carmaker has significantly surpassed or approached Tesla's price/sales ratio in 2021.
However, the strong near-term trend for these leading EV makers is sustainable despite their move away from our valuation system, and into marginal pricing, CICC said. (News Source: CnTechPost & MarketWatch)
NIO Leads Battery Swap Standard in China
A total of five power swap industry standards were officially approved for release on October 23, 2020 and will be implemented from February 1, 2021, according to China's National Energy Administration (NEA) 2020 Announcement No. 5 document.
NEA releases power swap industry standards developed by NIO study
NIO led the compilation of three standards 10435, 10436, and 33025, and was deeply involved in the compilation of two standards 10434 and 33004. This batch of standards took more than 2 years from project inception to release, and hundreds of comments were collected.
NIO participated in the development of over 20 standards for power swap
NIO launched BaaS battery rental service based on NIO Power Swap, providing flexible battery services such as vehicle-electricity separation, battery rental, rechargeable, exchangeable and upgradeable, which is a breakthrough innovation in technology and business model. So far, NIO has obtained more than 1,200 patents related to Power Swap and has participated in the compilation of more than 20 power swap standards. NIO will continue to adhere to an open attitude to promote the power swap model and standardization work, and realize the industry to build industry ecology, and make sustainable contributions to green low-carbon travel. (News and Photos Source: NIO App)
We are bullish on NIO for one of the reasons that NIO has differentiated itself clear in the beginning to bring electric vehicle seperation concept live through their models. They embrace this concept across their car models so battery design is standardized which can be swappable without model compatibility issue. This is a brilliant idea and NIO consistently pursuing this path despite challenges and doubts on this technology in earlier years. Some analysts may not get the battery swapping concept as this is not working here in western countries. But that doesn’t conclude that battery swapping is not applicable in a different country where the cultural and customer behavior is totally different.
Now NIO has voices in shaping China’s policy on battery swapping standard which is a reasonable move by the government that values NIO’s expertises (>1200 patents) in this area. The government support on battery swapping technology is a favorable decision for NIO in the long term.
NIO Power Update: 70-75th Power Charger
NIO Power Charger #70 | Macau Oriental Resort
NIO Power Charger #71 | Macau Casino Lisboa
NIO Power Charger #72 | Changsha Chuyuan Road
NIO Power Charger #73 | Baotou Wanda Plaza, Jiuyuan District
NIO Power Charger #74 | Ningbo Zhougang Grand Hotel
NIO Power Charger #75 | Shaoxing Haishangyunxing
One good observation to make this week is NIO launches their first power charger station at Macao, a China province outside the mainland China. This is a little step for NIO to expand outside from mainland China. The local NIO owners club sees a surge in growth to more than 100 owners. Do you know that six NIO owners from Macao subsidy the first Power Charger there? (News and Photos Source: NIO App)
NIO House & Space Update: 2 NIO Spaces Added
NIO Space #180 | Luoyang Quanshun
NIO Space #181 | Suzhou Wuyue Plaza
This week we observe two new stores opening in China. We think there is another NIO Space missing in Macao. We will wait for official photos for the 182th NIO Space at Macao. We are 19 away from the 200 year-end target. For past NIO Space photos, you may visit our facebook photo album here. (News and Photos Source: NIO App)
NIO 100 kWh Battery Update
Yesterday we featured a special edition on NIO 100 kWh Battery. Let’s recap this battery launch event with few highlights.
4 Technological Breakthrough of Battery Systems and Design
Heat-spread safe design for better thermal runaway management capability
Integrated Cell to Pack (CTP) Design (19.8% improvement in volume utilization, 37% improvement in energy density, 17.5% improvement in thermal management performance, and 40% simplification of manufacturing and assembly)
All-weather temperature control to improve battery performance and extend battery life
Cloud integrated BMS for precise control from the core to system, achieving the perfect balance between optimal conditions and extreme performance.
Battery Upgrade Plan
There are two types of battery upgrade plan offered by NIO to its users, which are the permanent upgrade option and the flexible upgrade option,
The flexible monthly and yearly battery upgrade is an innovative initiative by NIO to provide a low-cost, high-capacity battery experience for users to personalize their electric mobility. (News and Photos Source: NIO App)
The launch of the 100kWh battery and the corresponding BaaS and battery upgrade solutions completes NIO’s product line. NIO's three unique value propositions which are battery separation concept, battery rental, as well as a flexible charging solution of rechargeable, exchangeable and upgradeable, give users more choices and allow them to enjoy the beneifts of battery technology advancement in which some other automakers couldn’t.
Summary
Is 420 really ten times better than 42? We would rephrase this to “Is 42 really ten times lesser than 420?”. Nope, NIO is an emerging EV automaker with unique value propositions that can differentiate itself from Tesla. Without a doubt, NIO has more room for improvement: larger scaling production issues, global market expansion, user experience, hardware & software improvement, power facilities expansions, etc. Li Bin knows about these issues and is working hard with the team to improve NIO better from the time being. Quoted his words, it is just beginning for NIO to resurrect from the earlier bankruptcy brink, and there is more for NIO to stay competitive in the EV market. In the long term, we are bullish for NIO, and there is a high probability for NIO to climb up ten times from where it is now today. Mark our words for this and come back in 10 years time frame.
We will periodically post quick updates on our NIOtime Instagram, NIOtime Twitter, and NIOtime Facebook. Please do follow us on social media too.
If you like what NIOtime is sharing about NIO, please help us share and grow the community to let more people know about NIO.