China Automotive Systems: Rare And Undervalued Chinese Industrial Success
- China Automotive Systems is a market leader with validated quality and service standards.
- First orders from Ford underpin growth, competitiveness, and warrant an equity re-rating.
- Three years of OTGDD on CAAS, including 40 days of video surveillance, prove a very busy business concern. We counted 600 trucks at one entrance in just 14 days alone.
- CAAS will pay its first cash dividend this year, and remains a prime candidate for a go-private transaction in the longer term.
- At only 1.0x book value, with zero long-term debt and a durable ROE of 12.6%, we see fair value of US$16 per share, nearly double recent levels.