Electric two-wheeler welcomes major positive policy, YADEA (01585) enters new phase of high-quality development cycle.

"Leading company in the electric two-wheeler industry" - YADEA (01585), continues to march forward with firm steps, anchoring towards farther, deeper, and higher places. Under the trend of overall consumer upgrading, when consumers choose electric bikes as their main transportation for short and medium-distance travels, in addition to focusing on product prices, appearance design, and battery life, the quality and safety level of the products have gradually become key decision-making factors. This consumer upgrading indirectly raises the industry's entry barriers, providing more development opportunities for high-quality manufacturers with good reputation and complete production qualifications, accelerating market consolidation, and gradually concentrating market share to top companies like Yadea. It is worth noting that the safety and compliance of electric bicycles not only receive key attention from consumers but also receive strong support from national policies. In 2024, the electric two-wheeler industry once again entered a period of intensive policy releases, welcoming a new round of reshuffling in the industry under the catalysis of new policies. As a leading company in the industry, Yadea fully benefits from the policies and steps into a new cycle of high-quality development. Policy catalysis, top companies show more "siphon effect" It is understood that in mid-August, the Ministry of Industry and Information Technology issued the first list of companies that meet the "Electric Bicycle Industry Standard Conditions" (commonly known as the "white list"). Among the 6 selected companies, Yadea occupies 3 seats, dominating the "half of the industry". After the release of the "white list", the Ministry of Commerce and other 5 departments issued the "Implementation Plan for Promoting the Old-for-New Replacement of Electric Bicycles" and organized qualified products from compliant electric bicycle manufacturers to participate in consumer old-for-new activities. This is also the first time that the country has issued a policy for old-for-new replacement of electric bicycles. According to the interpretation of the Market Development Department, the "Implementation Plan" promotes consumers to update their old electric bicycles with qualified electric bicycles produced by companies listed in the "Electric Bicycle Industry Standard Conditions" announcements (the "white list"). Currently, the "white list", "Implementation Plan", and other policies have had immediate effects. On August 27, Hubei Province took the lead in implementing measures to support the old-for-new replacement of electric bicycles, offering a subsidy of up to 500 yuan for purchasing new electric bicycles produced by companies listed in the "white list". Following suit, provinces such as Hainan, Sichuan, Yunnan, and Hebei successively issued relevant implementation plans. With the successive release and implementation of the two major industry policies, on September 19, the Ministry of Industry and Information Technology, together with the Ministry of Public Security, Emergency Management Department, and other departments, launched a one-month public consultation on the latest revised "Electric Bicycle Safety Technical Specifications." This will further improve and enhance the "new national standard" in several core areas concerning user safety, such as improving fire resistance, preventing illegal modifications, and limiting vehicle weight. Under the country's attention and guidance on the industrial upgrading of the electric bicycle industry, the safety level of electric bicycle products has been further improved. Electric bicycle related standards and industry norms have become prerequisite conditions for market access, and compliance will also become the industry's inevitable choice. In the process of compliance, the industry will face a new round of reshuffling, especially manufacturers selected for the "white list" whose products will gain more market opportunities and policy support. Additionally, due to the high-quality product quality and service levels accumulated over the years, these excellent enterprises will be increasingly favored by consumers, promoting the industry's transition from quantity to quality. On the other hand, some manufacturers in the industry with backward research and development capabilities, solely relying on assembly sales, may further lose competitiveness, and ultimately may struggle to sustain their operations and fade from consumers' view. Embarking on a new journey, Yadea consolidates its core capabilities and anchors for the long term Currently, China's stock of electric two-wheelers has exceeded 400 million units, with consumer cultivation basically completed, and future replacement demand will ensure the long-term stable sales of the industry. Facing new market opportunities, leading companies represented by Yadea will continue to strengthen their core capabilities in research and development, brand, channels, production capacity, and other dimensions, in order to maintain a long-term competitive advantage in the competition. According to the mid-term annual reports released by various companies for 2024, Yadea's sales of electric two-wheelers still lead the domestic market share of two-wheelers, and Yadea remains the largest enterprise in the electric two-wheeler industry. It is understood that since its listing in 2016, Yadea has accumulated R&D expenses of 4.78 billion yuan. By the end of 2023, Yadea holds over 2,000 patents, has 2 CNAS national-level enterprise laboratories, 6 industry-leading technology research and development centers, 8 global intelligent production and research bases, and 1 national industrial design technology center. To enhance the core competitiveness of its products, Yadea continues to optimize the layout of the industrial chain upstream and downstream, creating a large number of research results that promote the industry's high-quality development in areas such as travel technology and energy technology. At the same time, breakthroughs have also been made in self-developed three-electric technologies. Under the boost of cutting-edge technology, Yadea's Crown series, the industry's first single series product to exceed 15 million units in production and sales, was launched. Consumers' purchasing decisions for electric two-wheelers typically focus on test drive experience and post-sales convenience, so a wide range of sales outlets not only increases consumer access to services but also effectively increases brand exposure and sales conversion. Over the years, Yadea has continued to expand its distribution network, deepen market penetration, and currently exports to 100 countries, winning the trust of over 80 million users worldwide. It has built a global sales map covering over 40,000 end stores, ranking first in channel coverage in the industry. The perfect channel layout allows Yadea to seize the opportunity of industry expansion and build a competitive barrier for the company. The market is not only domestic; Yadea strives to replicate its core capabilities to overseas markets with the goal of "serving global users and becoming a world-class enterprise." Currently, Yadea has identified Southeast Asia as a focus for entering overseas markets. In early 2024, the company laid the foundation for a factory in Vietnam; in March, the first vehicle was delivered in the Indonesian factory; in May, the foundation was laid in the Indonesian factory. Frost & Sullivan predicts that by 2026, electric two-wheeler sales in overseas markets could reach 46.3 million units, with promising sales figures in Europe, America, Southeast Asia, and India. Based on Founder's research report, in 2020, the major countries in Southeast AsiaThe number of motorcycles has reached 250 million. Against the background of "oil-to-electricity" transformation, the huge stock of motorcycles in Southeast Asia will become a potential market for electric two-wheelers. The founder believes that YADEA is gradually entering an accelerated period in overseas markets, performance contribution is expected to gradually increase, and maintains a "strong recommendation" rating for YADEA.Based on the optimistic outlook for Yadea's future development, several securities firms have recently given Yadea "buy" and "hold" ratings. Being widely recognized by securities firms is beneficial for investors to discover Yadea's investment value, attract capital allocation, enhance stock liquidity, and create greater investment returns for investors. In conclusion, in my opinion, the success or failure of electric two-wheeler companies does not lie in the sales end of buying and selling, but in how companies refine key capabilities, forge products that consumers want to buy, convert good products into brand strength, and implant themselves in consumers' minds. Yadea focuses on improving its core competitive capabilities and providing consumers with higher quality electric two-wheeler products. With its leadership advantage and solid foundation in the industry, Yadea has the potential to capture more market share in the global electric two-wheeler market and enter a new cycle of strong growth.