The car market is currently under a lot of pressure. In the first quarter, new registrations in the EU rose by a whopping 17.9%. March was particularly dynamic, with a plus of 28.8%. The growth was driven primarily by battery electric vehicles (BEVs), which rose by 58%, increasing their market share by 2.5 percentage points year-on-year to 13.9%.
The growing interest in electric cars plays into Renault's hands; after all, the company has placed particular emphasis on electric roadmaps in its ongoing "Renaulution" strategic plan. This includes, among other things, an IPO of the "Ampere" e-car division, which is planned for the second half of the year. According to the plans, Ampere will already offer six electrified models by the end of the decade and will then produce around 1 million e-vehicles for the Renault brand. This high volume will be made possible by Renault's "ElectriCity" production network in northern France and its numerous battery partners. In this regard, the carmaker recently announced another success with a new long-term cooperation with Verkor. The battery start-up is to supply twelve gigawatt hours of batteries annually from the planned Gigafactory in Dunkirk, France, starting in 2025.
Moreover, long-time companion Nissan has a 15% stake in Ampere, in which Renault will continue to hold a majority after the planned IPO. This deal was concluded as part of the reorganization of shareholdings between Renault and Nissan. The third member of the alliance, Mitsubishi, is also considering joining Ampere in order to work more closely with its partners on electromobility. The three-way alliance of Renault, Niassan and Mitsubishi is expected to not only create additional growth opportunities, but also increase efficiency among carmakers. The cost benefits are estimated to be several billion by 2030.
Operationally, Renault 2022 has turned the corner. Thanks to the sales launch of several new models such as the electric version of the Megane, sales increased by 30% to EUR 11.5 billion; analysts had only EUR 11.08 billion on the cards. Profit before special items even tripled and shareholders will receive a dividend for the first time in 4 years. "We have left the emergency room and are back in the game," says Renault CEO Luca de Meo confidently. The operating return doubled to 5.6% and is expected to improve to at least 6% in 2023. To further increase profitability, Renault does not want to get involved in the price war instigated by Tesla. "There is not much incentive to lower prices and get into a spiral that some of our competitors are following," said Renault CFO Thierry Pieton.
On the stock market, on the other hand, Renault has barely been able to get off the ground lately. The most recent breakout attempt at the beginning of this year above the upper limit of the sideways trend in the EUR 37 range failed. The price then retraced to the 200-day moving average, which now acts as potential support. On a two-year horizon, the price engine of the CAC 40 member thus virtually idled.
The overriding sideways trend combined with high volatility creates the best conditions for a barrier reverse convertible (BRC). This product type promises a return even in the event of stagnating or moderately falling prices. Leonteq has launched two new single softcallable BRCs with "electrifying" coupons and low barriers. The CHF variant offers a maximum yield of 14.00% p.a., in EUR even 15.00% p.a. are possible within the maximum term of 15 months. The percentage double-digit returns are secured with comfortable risk buffers in the amount of 41% each.
The profit chance can be increased with a multi-structure: If one adds the two competitors Stellantis and VW to Renault, a coupon of 17.00% p.a. is possible with an identical risk buffer of 41%. The term of the CHF-denominated product also ends after 15 months at the latest. The first soft callable observation date takes place after half a year for all products presented.
We look forward to answering all of your questions about our products and how they are traded. Please don't hesitate to get in touch! Phone: 058 800 11 11, email info@leonteq.com or contact us here.