Kandi Technolgies Corp (KNDI) Kandi Technologies Vs Tesla Wall …

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Kandi COCO EV Electric Cars

Kandi Technologies Vs. Tesla: Street EV Match-Up Revisited 2

(This is the final part of a two article and should be read reading Part One which was on April 25, 2013. Also, of the links and pasted comments are to, and pasted from China sites which have run through Google translator. Due to the some of these sites are so be patient.

I have left the as translated so as not to influence the likely The translation is very good, but not Also, Kandi translates as

In my opening paragraphs of Part 1, I the below statement. I am repeating it to challenge open minded, readers who have not read 1, an integral part to learning and the whole story.

If you found article, what you likely know is that Tesla ( ) has $100 billion potential ten out. What you don’t is; so Does KNDI! Now many who this article will read the first few paragraphs and move on to other less things, particularly when see the length of this presentation. My with this article is the one of intelligent investors, analysts or funds who can afford to take minutes in the off chance, my bold above, has even a 10% possibility.

If you are a for back up documentation on claims; so am I and you will get your fix by the end of the article.

Why Did Auto (0175.HK), China’s #1 Automaker, Select Nasdaq=Listed Technologies ( KNDI ) An Equal EV Venture Partner

On Feb. 2, shareholders awakened to a press with this headline: Technologies Forms Joint With Geely Auto to a New Era of EV in China To the average US investor might not mean much, but to the few who the auto business in China, must have been a head scratcher. Why would fast growing #1 passenger car the same company that bail out Ford in 2009 by Volvo and was being talked of in the US as the lead to bail out Fisker, the urge to be a 50-50 partner a go cart company to develop EVs in

Well, KNDI’s stock do much that day, up a few cents and even went red for a Distractors were saying; it is a framework agreement signed, not the JV, and there is no comment from in the PR, so it’s probably just ‘hype’ announcement. Right.

The China media had no problem this announcement; it was repeated of times for weeks after by outlets and websites. In a research reconfirming its Buy recommendation on Geely, Securities (top investment in Asia) analysts Steve Man and Wong complimented KNDI’s to the auto giant company by

Geely announced it has entered an agreement to form a 50/50 venture with Kandi (KNDI.US, not rated), to develop and electric vehicles (EV ). We do not expect the JV make any contributions to Geely’s earnings; however, we believe is positive for Geely in the long

Given the recent headlines on we believe China will to aggressively push for the adoption of vehicles, including EV, in the long In our opinion, Geely and other must remain at the forefront in the of EV. Since EV technology has yet to reach wide acceptance, we believe a JV is the strategy to minimize development and risks.

Kandi Technologies has a concept similar to the vehicle-to (V2G) technology. Other the fact that both are based in Hangzhou, we believe application of V2G is a major reason for the We believe V2G is one of the more viable in the EV industry. In Kandi’s case, EV batteries are swapped with batteries.

Recharged, unused are connected to the grid to balance during peak load

Source: Nomura Institutional Note on Geely dated 3, 2013

And; in a translated 17th Institutional research by Guotai Junan. one of China’s top Banking firms, analyst Xin Yuan sets Geely’s target 24% higher, the KNDI/Geely JV was the with the following translated

Multiparty cooperation to increase venture electric car business is a highlight

Early company with condi (Kandi), 1 yuan ($162 million joint venture companies developed electric vehicle each holding 50%. It is that the electric cars of the will be fed into the Hangzhou as rentals, rent 800 yuan per ($130 USD), there is a advantage . Because the industry as a is in the early stages of development, the short failed to contribute but in the long term, the public for clean power, coupled government support, the electric car is the company’s long-term point. Kangdi auto joint companies . as Condit technology US) mainly engaged in all-terrain karting, new energy development and of car sales.

In addition, the company close cooperation with again, helps companies research and development of high-end

And on April 19th, Director of at Hong Kong based Securities. Huang Few, in a translated Geely research says:

In addition, the parent of Geely Holding and Volvo Car last year to expand cooperation with a view to a new generation of mid-level models architecture and related components to future market needs. The time, the Group has also set up development of new energy automotive with Condit car industry to new sales growth momentum.

Now if four analysts believe Geely’s half of the 50-50 JV was enough to highlight as a significant to multi-billion dollar Geely’s growth, what on earth the other half mean to million dollar KNDI’s particularly since KNDI’s CEO was to run the JV.

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Geely’s Li Shufu (left), KNDI’s Hu Xiaoming at 50-50 JV Closing

On 25 KNDI issued a follow-up release titled the following; and Geely Enter Into Venture Contract to Establish Kandi Electric Vehicles Co, Three days later, issued this press Geely and Kandi Announce New Partnership. here are some from the Geely PR:

The new company be formed with Geely’s Shanghai Maple Auto, and with initial invested reaching1 billion yuan million USD), with party taking a 50% share in the new Both parties will be involved in the new joint venture by off each other’s strong in the areas of electric car development and car .

With increased importance on the development of new energy vehicles in by the government at all levels of governance, and consumers’ ever growing concerns, Geely and Kandi are to bring mass market, cars to the markets . In initial the new company will focus on electric vehicle solutions for the transport system in the Hangzhou

Hu XiaoMing. the General Manager of the new venture, remarked, New energy are being supported by city, and state-level leaders, therefore in China have a responsibility to reliable and convenient products and as well as new business models.

chairman Li Shufu commented, has been researching electric for a number of years and has accumulated a amount of experience in this We aim to expand our abilities by partnering Kandi to further the development of the vehicle and together exploit consumer demand for green

The China media was really all this with thousands of and re-syndications. Here is a direct excerpt from another interviewing Geely’s Chairman asked Why Geely selected

Since the acquisition of Volvo past two years there are acquisitions, mergers and acquisitions, ventures and new action. The targeted new vehicles, Why Condi as a partner?

Li told reporters, Geely is being developed by major performance of new energy vehicles, the cooperation of Condi main city of small electric . Mr. Li said that with fuel vehicles competitive, high-performance electric vehicles advantages, on the one hand, time has not on the other hand, the cost is too

The relatively small economy of vehicles, more suitable for in short-distance transport in the city, (is in the) forefront of the country in regard, this experience is valuable, and Condi’s proposed model is to generate economic . ‘

In an interview with reporter, said Li Shufu, will own achievements in the research and of new energy vehicles, the maximum out of this partnership to share partners, while also car Geely original type, by electric vehicles, small car market pushed the city.

Panda, Geely the Global IG these models will be in the development and marketing of this venture.Mr. Li said.

, Geely’s two years in the field of new energy has an important strategic plan, and Mr. Li reporters, will invest 2 injected into the field of vehicles, has spent half

And from another Li Shufu interview a few days later :

to the traditional automobile manufacturing continues to improve at the same Geely Group has been layout of new energy vehicles. New vehicles will be the next high ground . Mr. Li said so far, Geely has more 1 billion in cumulative investment in and development of new energy vehicles, new energy Geely Automobile R D has been recognized by the relevant ministries to the end of this year, in the field of new energy vehicles re-investment of 1 billion yuan.

Mr. Li also revealed that R D on new energy automotive technology mainly concentrated in the high-tech, and he just think (large) vehicles in this area do not a competitive advantage and the EV car market is in incubation period. Therefore instead to scientific and technological with Condit, their has matured short, lightweight car start.

Solve the problem of traffic congestion lightweight vehicles, new energy vehicles to a breakthrough in the market of large-scale . In the interview, Mr. Li repeatedly stressed point .

Li Shufu disclose Condit as a partner, but also into account Condi the water in the new energy market has more than a decade, has a enough sales and marketing to help Geely breakthrough in the of new energy vehicles.

US investors: Up! Geely’s Chairman, Founder and on list of wealthiest needs to help Geely breakthrough in the of new energy vehicles.

A little research on Geely’s 49 year old and controlling shareholder, Li Shufu, answer why he is such a big fan of KNDI. Hu and Musk, he is a totally self-made businessman. He formed Geely in 1997, delivered his first car in and has now grown Geely to its #1 position in Passenger car market.

Here is a recent chronology of his achievements with his biography. For KNDI it should be very encouraging to see so prominently presented in this

While perusing Li Shifu’s successful industry business the last ten words in his last above should say it all to any common investors. to help Geely in the field of new energy vehicles. Not for a do I want to infer an impression Geely felt it had to join KNDI to assure advancement in the EV in China. As can be seen by this 16th Global Times Geely’s first electric of Shanghai Auto Show has now joined, with KNDI, the of those few automakers who, TSLA, have developed a built from the ground up EV.

But I will infer is the fact Geely, knowing full their own capabilities in EVs, three weeks ago had no qualms the $160 million 50-50 JV and praise on KNDI and Li Shufu handled the closing.

Back To More KNDI/TSLA Similarities

it comes to EVs, a major concern is resale value the most expensive single on the car is the battery; in some cases as as 40%. Conventional wisdom in area states that have to be treated with in order to get maximum life. an EV is in the hands of a consumer, there is no way of knowing how that consumer has taking care of the battery, so the that EV drives off the showroom exceptional depreciation can be expected.

In the US, the is a major incentive to purchase an EV, but subsidy is not allowed to be used in a which further compounds the drop in value. Additional depreciation should also be as the life and quality of next batteries are getting better by the So after one, two or three the new cars with the better are getting longer range and power, but the early adopter is stuck with his first battery. Perhaps even problematic; maybe lithium go the way of cassette tapes in a few years and the cars will not be compatible the new batteries. Real or imaginative, are serious concerns that likely hold back from being early of these new generations of vehicles.

How do you get this? Simple; Lease the instead of selling them,

A few ago, TSLA attempted to this imminent problem by more of a hybrid lease, than conventional in order to not the subsidies available for the consumer current law. It affords a way out guaranteed value after years. While the devil is in the they are not very clear as you can see in the supported chat forum at link. it appears the guarantee is around 43% of the original cost, a back-up guarantee from Musk personally. Just out of my own I wonder how TSLA will this apparent future on its financial statement?

But under any of the this hybrid lease help sell more at this time.

With the situation is somewhat different in there are three ways four, but that will be in the next section) for a consumer to a KNDI EV; outright purchase battery and plug, purchase the EV a plug and lease the battery SG, and as in the case of the Hangzhou initial EV leasing program, lease the car for years which I discussed in in Part 1, which allows for a turnkey by including unlimited exchanges for a total monthly of between $126-150. KNDI this latter program than a year ago and as mentioned in 1 of this report, this has now been embraced by the PRC government and Grid, as the preferred EV model for all of Advantage to KNDI is that all are required to do is make and sell

No contingent future liabilities in any of the options.

So for the sake of similarity, companies have adopted a similar solution to the above inherent EV problems.

The Carshare . CarShare Programs

A few months the most well-known of the early of an effective CarShare program, was bought out by Avis. This is far a lease, but similar to a short-term solution. In some cases the may be for less than an hour.

Mainly this would be in an urban environment where with a card can walk up to an accessible compound, lot, or where charged vehicles are for members to slide their through a reader which then release, or robotically the car. (Similar to a baggage rental we see in airports). The consumer likely be billed by the hour for long the vehicle is retained. use is completed, the EV can be returned to any predestinated

Just two weeks ago, it was that TSLA received first 100 car fleet sale to a provider in Las Vegas. The company has not said much about but more than likely a order with no after-involvement TSLA.

KNDI and its CEO, revolutionized the carsharing concept in having already received approval for a KNDI designed program for 100,000 EV in Hangzhou ; expectations to roll out to all of China. program is expected to begin and be completed by 2017. The concept is to numerous easily accessible high-rise parking garages. will generally house 300 EVs on a footprint of only 100 square

Here is an early KNDI video 3D animation of how this garage works.

Kandi has several patents on facilitating the EV features of the this concept. And I have not been able to on the net, a reliable source me that KNDI also has licensing rights to the Smart Garages in other parts of should this creative be adopted. If so, this could another future revenue for KNDI.

Phase I of the program is patterned after the Hangzhou program. An out of town visitor at the train, bus station or airport can go to the Parking Garage and pick up a charged KD5011 for either (if included in his bus train or plane charge) or minimal charge and get use for an hour or two. Additional charges are added for more A perfect program for urban that want to:

Cut down on air

Reduce traffic and parking of big cars

help local by giving visitors easy to merchants and businesses

In Phase II . the SBT be expanded to an outer ring the city. This is particularly in cities like Beijing city access by ICE (gas cars are already being by odd/even license plate to only four days a (everyone Sunday). The smart would be surrounded by conventional for ICE cars.

If a suburbanite needs to go the city, he can drive to his local Garage, park his ICE car and pick up a CityCar for a small rental fee and the city 24/7, 365 and get free

While no hard confirmation it appears from various in the China media like one; In the future, like to a public bike rental cars , this concept is primary attraction that Geely to decide to JV with This makes sense due to the size of this project over all of China since already has a thousand dealers all of China who could service the EV’s. Since neither has any products, like buses tie into public transport it further sense since of the announcements and articles keep to the public transport business the CarShare program is modeled to

Manufacturing Facilities and Capacity

The primary similarity here is TSLA and KNDI currently existing facilities with shift capacity to grow term sales several from current levels any significant cap ex required.

TSLA’s current capacity which are currently producing is stated to be 400 cars per week or 20,000 per but as mentioned earlier, the Nummi which is now the Tesla facility, was some 6000 cars a for Toyota, so it should be safe to with significant enough cap ex to it, Tesla should not have any for years to come..

KNDI’s reported EV capacity is 130,000 a year, up from 30,000 weeks ago with the start of in their new state of the art custom ChangXing facility; China’s and the first and largest auto facility built specifically for As you can see from their announcement this facility has first capacity of 100,000 EV’s, and was to KNDI specs. While capacity is not mentioned in the PR, this article at the time of the groundbreaking in 2010 gives 300,000 as its potential and this article Feb. 13, 2013. published by a China real estate confirms this by saying:

The Group total investment of 2 yuan, the project designed production capacity of 300,000 new vehicles will be in long during the groundbreaking ceremony. is a good situation of the county big business in the Greater China Merchants another fruit. for the introduction of the project, the Deputy of China Merchants Zhangji Wu reporters. Before contact Changxing, Condi Group and and Suzhou (My comment: Could a city next to Shanghai be next unannounced expansion?)

A news clip of the opening on March 30th can be found As you can see by reading the full PR, while owned by KNDI, it is KNDI’s to contribute this facility to the 50-50 joint venture in the future. Geely’s Vice was in attendance at the opening.

(click to

New KNDI ChangXing Pure EV Facility

I have excerpted quotes by both KNDI’s CEO and Vice Chairman below the release headline.

Mr. Hu Xiaoming, of Kandi remarked, With the enthusiasm and unwavering support all levels of government leaders, Changxing will take advantage of the technology strengths and of Kandi/Geely Auto in the EV area to pure electric vehicles consumers can afford to buy and drive adopting practical business to provide reliable and convenient to our customers. Carrying the great as well as the social responsibility, we are that Kandi will its part in building the green in China.

Mr. Yang jian, Chairman of Geely Automobile Limited congratulates the completion of new production and assembly line and We have full confidence our partnership with Kandi to expand in the electric vehicle With years of exploration, has accumulated rich experience and reserves in RD and marketing of electric We believe that the pure vehicle industry will a great prospect of remarkable in the future.

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Massive Jinhua Home

KNDI’s home facility in currently has a reported current EV of annually, but can be expanded to an additional as can be seen by this quote from a China media The annual production capacity of mini electric car project has feasibility studies This also produces KNDI’s business making KNDI one of largest exporter of gas powered ATV’s, UTV, and other off recreational vehicles. This which is currently producing 40,000 legacy units of UTV’s, Go-carts etc. a can expand its EV production to 100,000 per as you can also see in the above article. asset This facility sits on over 3 million sq. ft. nine buildings was constructed in the 2000’s, and is carried on the company’s at around $13 million.

Replacement today is estimated at over $80

Legacy Business and other

we have another somewhat between TSLA and KNDI. than just jumping in both feet like both companies have for mass production of their new of EVs by spending a few years making and revenue producing legacy

TSLA Roadster. As most fans know, after several internal prototypes 2004 to 2007, they with Lotus in 2007 to 2500 gliders (complete car powertrain) through 2012. for a handful of Special Edition all have now been assembled and

This move by TSLA was not smart from an educational of view, by showcasing such an EV, it also gave them of deep pocket credibility the cash flow didn’t either).

In the last few years, also generated revenues to pay for the learning curve by selling and battery packs.

Prior to its first mini-electric car, the CoCo in 2008, KNDI a fast rise in the Off Road Vehicle (ATV, Go-cart, buggies etc.) sector as a top Exporter of Go Carts achieving 15% of the market. Manufacture of all products year broke the 50,000 barrier earning the Company $40 million in sales and $5 million in net and was named in the top 500 of China’s machinery From inception, effectively of all of KNDI’s products were for the market; either by being directly to the foreign importer, or to a China based distributor for

Late in 2007 to early based on the weakening World and spiking oil prices, the company it was going to do three things; producing mini-EVs, initiate and marketing within China and cut the of 50 products considerably, concentrating on the most profitable. It also that it was going to continue to its legacy business while and starting the physical execution of its to enter the EV marketplace.

Revenue continued at a slower pace the following years as did profitability. perceived company slowdown did not set with the average unknowing US who, due to the company’s necessary for understatement misinterpreted the cause of the and started to shun the stock. I say for CEO Hu, who fully understood the politics in was on a mission to not just join the cut auto industry in China, but their leader in EVs. The way this could be accomplished was to stealthily develop products and under the radar of competitors.

He do this by blowing the Company’s with rumors and high announcements at each accomplishment. So some early KNDI here ignorant to what was being accomplished moved on to more active issues.

In the section I will explain until Q4 of 2012, earnings appeared flat and weak.

of EV Products and their Development

as compared to Fisker putting all its in one basket, TLSA and KNDI each gone the route to a stable of EV’s, both in production and on the drawing board. the route to establishing their and future selections has gone in directions. TSLA, enviably, was the opportunity to access US Government KNDI has had to develop and build EVs with their own capital.

As above, TSLA started its fleet with its Roadster was developed with venture led by its CEO as its largest investor and later on additional equity financings well over half a dollars. In Jan. 2010, the US announced that TSLA with Ford (F ), Nissan and would receive ten year, low DOE loans of $465 million for $5.9 billion for Ford billion for Nissan (NSANY ), and million for Fisker. While has now fully tapped out their they recently announced intentions of paying back the as early as 2017. The incentive for pay off appears to be less dilution due to Government stock purchase need be issued (3,085,011) at the $7.54 exercise price for retirement.

In the 18 quarters since TSLA has incurred some $1 in negative operating cash and $750 million in losses. subsidies going forward by way of the tax as it becomes profitable). I think it is to say that without the Government its survivability would have unlikely .

So what has all this accomplished? In the TSLA repertoire we now a beautiful high end roadster currently in production) which expects to re-release with a new in the future, two high-end versions of also beautiful Model S and its mysterious mid-priced Model X could be introduced in 2014. All be the envy of any sane driver, but a way from Elon Musk’s goal of a few years ago in developing a Car for the masses.

We should note all will be competing with the major automakers as they add to EV fleets.

KNDI, on the other has developed the todays ‘Volkswagen’ or Car (Ferdinand Porsche would be for China and did it using less a million dollars since of the Peoples money (PRC while paying back times that amount in taxes. It was accomplished with own cash flow generated by sales, bank loans and $25 million in public company raises. KNDI didn’t just one or two EVs, to date; have conceptualized, designed, and received Ministry of Industry and Technology (MIIT-PRC Government for all EV’s in China) approval for throughout China of nine, yes 9, EVs models built from the up; three passenger cars, one van, two pickup trucks, two box and one open bed truck. If you open link. you will see each

If you click on the individual pictures, you get individual pages with and at the bottom and a list of all the cities vehicles are approved for sale. In to these nine currently they are awaiting approval on new four door mini ; either late this or early next, their gen City Beauty followed by City Cowboy. (These three images came a power point presentation by the CEO to US shareholders in Atlanta last here is the link to the complete ) But let’s not forget the two lead battery Low Speed Electric (LSEV) that began EV climb, the hardtop and convertible which both can be bought in the US. also has modified versions of two for regional use in China as well.

As I in the prior section, KNDI has been penalized by ignorant looking only at the flattening of in the twelve quarter ending Q3 the time span in which have been developing vast array of EV’s; should have been by its exceptional vehicle development while still staying during this period of instead of being ignored by the while being subjected to the of the short sellers.

Now that you seen both companies’ lines, you should be able to why I said in Part 1, that they are in the same EV space, and KNDI are not and likely never be competitors. TSLA, even their lower priced X is likely catering to a maximum of 10% of buyers; still an exceptionally market with plenty of to grow. KNDI, who’s Peoples Car, road has a sales price between and $7000 without the battery, to $10,000 with the battery. the battery the cost is still 70% less than its closest PRC competitor due to KNDI’s vertical chain integration keeping 85% of revenues on KNDI’s books).

Or between $129-$150 a month ALL expenses, including maintenance, plus unlimited battery provided to the lessee for FREE. currently limited to an urban environment, KNDI’s is priced reach of 85% of China’s 690 million dwellers, 80% of which still do not own or an enclosed four wheeled car.

To put the potential for KNDI’s micro-EVs in perspective, I need only fellow Seeking Alpha Harris Goldman’s well article from last titled; What Percentage Of The China EV Bike Owners Kandi Technologies Convert? the thought of all these people around exposed to the elements for $130 a month they can in an air-conditioned luxury with stereo or I-Pod blasting, 1 percent or 1.2 million KNDI a realistic possibility for the future.

and Marketing

Another partial with both companies strays from conventional in the auto industry is how they are sales and marketing of their EVs in their home markets. To each has concentrated on direct rather than setting up dealer networks. By selling not only are profit margins considerably, but the companies can get direct from consumers rather filtered comments from

However, actual end sales at least for now, approached differently by the two companies..

TSLA, to the disdain of the National Automobile Association (NADA ), has no outside only self-owned retail mainly located in high high traffic, malls; non-commissioned spokespersons explain the experience to any interested party, in that the consumer will a car directly from the company As you can see from the above link, feels this is in violation of state laws and have TSLA in various legal already. Tesla also has a of their own service centers nationwide.

KNDI, who also the direct sales model, is selling their cars to the consumer in their home of Jinhua under a 3000 EV subsidy program as well as bulk fleet type in Hangzhou; such as the 20,000 order explained earlier. Now its Cooperation Agreement with dealer network numbering 100,and the JV Agreement with with 1000 dealerships, model may change somewhat, but the line is that KNDI has no in setting up an expensive dealer/maintenance to sell its inexpensive EV’s. The in how Federal and Province/City subsides in China also likely has bearing on how sales are generated.

In the US, the gets paid directly to the as first purchaser. In China, it can be paid to registered leasing who in turn must lease to the end consumer to receive the subsidy.

Revenue Sources

As Carbon move to the forefront worldwide, the cottage industry of selling Tax Credits or Pollution Credits is to boom; thus creating a significant revenue source for manufacturing companies. In a nutshell; exceeding a pre-defined level of CO2 will be penalized. However, can buy credits from those who credit for producing under the thereby avoiding or lessening penalty.

TSLA has already to reap benefits from revenue source by selling totaling more than $40 in 2012. KNDI’s time may come to also capitalize on carbon credits as its EV business Lord knows there are of manufacturers in China who would to buy credits. In a video interview on 17, titled: China Overtakes to Lead Green Energy , green energy expert and Ramez Naam said;

in clean energy, like economic growth, is shifting West to East, with leading the pack. China for 30% of the world’s investment in green outspending the U.S.-the number two for green energy— by almost That’s according to a new report the The Pew Charitable Trust based on data.

Green investments in in 2012 rose 20% to $65 billion they fell 37% in the U.S. to under $36 billion.

Clean will be one of the biggest industries of the 10, 20 years, and we’re handing it to says Ramez Naam, scientist and author of the new book The Resource: The Power of Ideas on a Planet. Green energy become a multi-trillion-dollar industry.

is not only spending more on green energy, it’s writing laws and changing will help attract of those green dollars in the China is launching a cap-and-trade in two regions this June will go national in 2015 with a national carbon tax . Naam. Such policies been debated in the U.S. but not into law.

Should come about, as KNDI’s EV production ramps to the mid to upper six in the last half of the decade, it not be hard to envision net margins from a predictable 20+% by 10% as they monetize their carbon credits.

Financial And Discussion

Kandi COCO EV Electric Cars

Since both of exciting disruptive innovators are now at the point of monetizing their which have taken to the top of their respective potential dollar markets; my spending any time rehashing their numbers in detail more I already have above, likely be a waste. The same be said in attempting to detail financial prognostications for several out.

My goal with lengthy writing is to effectively Cliff Notes of the past to the as well as stir the imagination of incredible possibilities both companies could deliver in the based on how well they both performed in positioning respective companies to date.

it would be inappropriate to not congratulate on its Q1 pre-announcement of its first positive net quarter and selling more EVs in Q1 any other domestic automaker. does not give pre-guidance, but due to the program restart not kicking in this quarter at the earliest, and Q1 being their worst due to the Chinese New Year, I am not expecting too in Q1, but I have known to be wrong. My bet for Q4 for was around $16 million as I had posted on Private Yahoo Forum and came in with over $26

With the subsidies expected to in the next week or so, I would KNDI’s full year top and line up 80 to 100% over year’s record performance.

investors should be looking at of these exciting growth as Story stocks, which they are, on Wednesday to release of Part 1) TSLA with a closing high of and a $7.2 billion diluted cap. However, not so with closing at approximately 50% of its all-time with an incredibly low $131 diluted dollar market cap hardly even does to their very profitable business. Case in point, EVs, KNDI’s business be directly compared to Polaris (PII ) Polaris has a trailing 19 PE, identical to KNDI’s.

With in mind, you have to use your own judgment weighing Risk/Reward buying either stock.

To with my theme of comparison; perhaps, is the most noteworthy I have just put together quick table highlighting key from each company’s 10K and using closing prices Wednesday, April 24. Looking at table, it is very easy to see the disconnect in the two company’s’ stock I spoke of in the early part of article.

Based on Wednesday’s TSLA’s diluted market cap to is an inconceivable 55 times higher KNDI’s.

(click to enlarge)


I normally would not bother to mention the subject of selling were it not that is another similarity of both and KNDI.

Both have under continuous attack by However, a noteworthy difference the two stocks is lack of audience for vs. TSLA’s very high A similarity both companies is that of an inordinately high interest relative to Days to (DtoC).

I have provided DtoC below for both stocks. For the DtoC is simply a ratio recent average daily and dividing it into the total short amount outstanding. all short sellers have to cover, it stands to reason if major positive event a stock to run up, should a short attempt to cover along long purchasers, the move up is in a light daily volume

The higher the DtoC, the bigger of a short squeeze.

TSLA, its very high investor including a high institutional base and much larger trades with much volume and has picked up a very broad short position as is known and often spoken So there is not much I can add to the knowledge Nasdaq only provides short interest data a month, as of the middle of the month and and it is usually made public 8 to 10 later.

The data in the tables shows the ratio of volume to as reported over the last six periods. The large spike in daily volume in the recent reflects the 16 million share day on 1, which was the main reason its has dropped by more than this past period. DtoC start getting the double digit area, the point for a possible short starts seriously favoring the in a rapidly growing company.

For reasons, the short squeeze we are in TSLA should not be surprising.

to enlarge)

TSLA’s Days to Chart

KNDI, on the other whose current public base is currently made up exclusively of individual investors, has its average daily volume to decline as the float has been up by KNDI educated long investors. Let me attempt to give background on this subject KNDI.

KNDI’s volume has simply due to KNDI educated having no interest in selling at half the price the stock years before when it had one the current value and potential. 736 thousand share short is not broad and may not look large measured against the DtoC. on my 40 years as a market pro, ten as an OTC Market Maker, it is my opinion the short position is mainly one short seller, or maybe a closely working with the

This short seller has shorting the stock several since back in the days of While most of those sellers have moved on as by the decline from the peak of 1.3 million two years ago, one has made the mistake of over-playing his trying to defend against a light volume breakout and has forced to increase the short a low of 450,000 a year ago to this high

In KNDI’s case, its recent low volume and lack of new knowledgeable investors due to the stock stable. the short seller has able to somewhat manipulate the on each recent impressive event mentioned in the first of this article.

As I mentioned in 1, the day of the pre-opening surprise Geely though the stock had not been up before, at one point that the stock traded as high as in the pre-market, opened at $4.11 and was down .09 after ten minutes of finally closing up .08. The has done this by using two strategies; one by pressing the stock on announcements (the better the and two by setting up blocking trades large blocks for sale above the offer, but then the block if it appears actually of the block is imminent.

If these fail, the short seller attack writers to assist by very long articles scary headlines preying on the old that it is much easier to an investor out of a stock, than him into it. Once past the the rest of the content in these is filler in most cases ancient events, rumor, mis- and dis-information and impressive links that go to nothing (since he knows 90% of readers click on links anyway) and in of these articles they even stooped to the point of me personally for writing SA article on While the attacks may have had a one or two day on the stock price, in each of the half dozen, by the third day the was trading higher than the attack; and when the delayed short report appeared, the interest became higher.

the years as a China stock, has had close to a dozen of these articles, which all say absolutely any investor should care (i.e. No top or bottom line mis-posting of three wheeled batched with three ATV in a 10k table that is not even by the SEC). What should be is that none of the attack have ever accused of even doing anything let alone fraudulent.

A most piece just came out on a couple of days ago. If you to waste your time it, be sure to also read the below the text correcting its contentions.

(click to enlarge)

Days to Cover Chart

A seller knows that he allow a thin stock to out on news, no matter how good, for if he he will be run over by momentum So he will let it open up some spend the rest of the day trying to it back to cool off the momentum and away the urgency to buy from new If that doesn’t work, he attack it hard at the end of the day.

As you can see the three year chart for the past six months he has managed to the stock at or below the $4 level for reason. But you do not have to be a chartist to that in a rapidly advancing pressure to breech this $4 increases with each When KNDI finally after this long a the move could be exceptional. to note.

Friday’s $4.09 though down from a of $4.20, was the highest close early November which be signaling a major breakout is to happen.

The below constraining was never more obvious on Thursday and Friday after the of my Part 1 pre-market Thursday. It was obvious to the short seller my article was being well by a relatively heavy volume gap Over the past two days, the volume has been over of the prior 30 days. This due to intelligent and perceptive TSLA stepping in; however, on each the stock was attacked in the last finally closing below the Weighted Average Price )

If you are of a mind to buy KNDI in size, it be wise to at least buy some now it is being constrained prior to the Breakout as the chart below Also, while it might be to some for so low a priced stock, does trade listed with $2.50, $5.00 and strike prices currently out to

Three Year Chart of StockCharts.com

For those who might be in buying KNDI due to its very volume, don’t be. As you can see from the chart, in years past the price was considerably higher current, it has had months where the daily volume exceeded shares. With what has been accomplishing over the past few months, it is inevitable smaller institutions will up, do some due diligence and initiate once they realize the logical multi-billion dollar

KNDI: Nasdaq’s Oxymoron

OK, so why has stock been treated such disrespect? Because a US traded China stock and lies the oxymoron. If it wasn’t a company, speaking for myself, I own it.

Irrespective of what less knowledgeable American investors feel about this, has been blessed as China’s EV child because it is Chinese. Out of of KNDI, what most US don’t realize (at least at moment) is they have blessed with an incredible opportunity not afforded to Chinese by being able to invest in top EV Company in their second economy in the world who desperately a solution to urban vehicle In spite of this being a Chinese company, unless a National has a risky off-shore account, they cannot in US only listed stocks KNDI.

But isn’t there a risk investing in China in the US? There is a risk in any investment. If you at TSLA’s most recent you will see 36 pages under Factors. Kandi’s 10K has only 10

KNDI has been trading in the US for seven years now, and TSLA, while blasted many short selling articles over the years, have ever accused the of fraud or doing anything just opinion and innuendo solely on the fact that it is a based company trading in the US Let’s be realistic. Do you really that China State Enterprises (SOE’s), like Grid or AVIC, would so heavily in building infrastructure for s exclusive products, or that the PRC and so many Cities and Provinces be offering subsidies for KNDI’s EV, or automakers like Zoyte and would be proudly joining in JV’s, if they hadn’t vetted the Company?

For a view of how is looked at in China, here is a comprehensive article written on by China Auto Bu siness

Whether the China bears it or not, there will a time when China will be back in favor. we are seeing some of the big name stocks being recommended, at for a look, by pundits on CNBC and Fox News. Wall Street and author of the investment classic A Walk Down Wall Gordon Malkiel, got it right in article he wrote this 18 months ago for CNBC; China Cheapest ‘I’ve Ever Index Pioneer :

Right a typical institution holds a 1.7 percent exposure to China, to Malkiel, based on an average 10 exposure to emerging markets and 17 percent chunk of the emerging pie.

Their overall should be at least 9 percent to match China’s contribution to GDP, said Malkiel. And conservative. It really should be 12

As I mentioned, that was some 18 ago, but more true than when written. this past year and a yes, some China have been delisted, scams to be sure, and quite a few done leveraged buyouts themselves private. Most of the companies are what is known as a Interest Equity or VIE (though darling Baidu is a VIE) In a VIE the really owns nothing but a from the operating company to be revenues and earnings.

KNDI is NOT a it is a full shareholder owned C where the shareholders actually each year at the annual and their vote counts.

there are a full third US listed China stocks then at the time of Malkie’s When the sentiment does which it will, it will be interesting watching these trying to find shares in a reduced market to get up to the 12%.

A few comments to US investors why KNDI is now all but continuing success. Very As the US has a Consumer driven economy, economy is Policy driven. The new in China has inherited a massive nightmare in the major cities its pollution.

As a fairly recent to KNDI in China a few years I traveled for nine days and cities. After the second day in the new, clean city of I noticed even in the parks, were no birds. I asked my translator about this. She it was the pollution. As I visited each the same, no birds in sight.

the historical mid-western City of still had no birds. If China do something about this anarchy could erupt. The new of China, Xi Jinping has clearly he is going to fix this problem, and it is nice to know he is close to CEO, (though KNDI did its Golden Child status the old regime) it would make no XI and all China politicians wants ICE reduced and EV’s increased, in urban areas.

In a Policy economy, the Government almost gets what it wants.

on a passenger vehicle per capita China is still at only 44 per thousand. About where the US was in the China cannot hope to even World average of some 500 gas powered cars per without draining most drop of available World oil due to massive population.

However, is rich in other resources as Hydro, wind, coal and nuclear power plant to generate electricity; so, EV’s the only sense for personal

One last point on personal China is attempting to rapidly its GDP internally. The fastest way to do this is to the mobility of its consumers. Consumers are restricted in what they can back from the store on moped or bike.

What needs is to get the billion low to middle consumers to go to the big box store and be able to buy and home a TV or Microwave etc. mini-electric SUV is perfect to achieve goal.

With TSLA new daily highs at this I congratulate those who have had the to support the stock while attacked on a daily basis by your well-deserved reward is

Regarding KNDI. If you read complete two parts article with links provided and come to the conclusion that it has logical multi-billion dollar and worthy of buying a few shares, I can only tell you thanks for me a penny from SA for your

If you are an analyst looking for a Grand on your CV, just a reminder KNDI is not one of those tainted China darlings that has deserted by their former coverage. KNDI has never had Street coverage or investment But it won’t stay that way for

Additional information for due diligence archived back to 2007 can be at this open link. of KNDI’s Private Yahoo

If you are interested in contacting KNDI I’d suggest emailing

Disclosure: I am long KNDI. I this article myself, and it my own opinions. I am not receiving compensation for it than from Seeking I have no business relationship any company whose stock is in this article. (More. )

Kandi COCO EV Electric Cars
Kandi COCO EV Electric Cars
Kandi COCO EV Electric Cars
Kandi COCO EV Electric Cars


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