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Kandi Technologies Group, Inc. (KNDI)

Kandi Technologies Group, Inc. (KNDI)

The alphaDIRECT Insight

According to management, Kandi Technologies is one of the pioneers of the electric vehicle industry in China.  Kandi introduced its first EV in 2007, and now produces EVs through a joint venture with Geely, China’s largest and fastest growing non-state owned automaker. Kandi has been listed on the Nasdaq for twelve years and we believe the Company is well-positioned to capture the huge emerging EV opportunity around the world, due to three key factors. First, the EV market in China is poised to grow at a rapid speed.  As the world’s most populated country, China is set to be the largest EV market in the world.  According to government forecasts, China’s “new energy vehicles” sales are projected to grow to 2.1 million units annually in 2020, which reflects only 7% penetration. According to management, Kandi is using good quality at an accessible price point to target the broad middle market for EVs, in contrast to competitors like Tesla or NIO that target the smaller premium segment. Second, in our view Kandi has a global opportunity as one of the first Chinese EV makers to sell EVs in the US market.  Additionally, on February 2019, the U.S. National Highway Traffic Safety Administration approved Kandi to ship its Model EX3 and Model K22 cars to the U.S.  Kandi has established distribution through its 100% ownership of SC Autosports, which is its exclusive distributor in the U.S.  Kandi’s plan according to management is to use its affordable mini electric cars to penetrate the large and underserved U.S. middle market. Third, management believes Kandi trades at a significant discount versus its EV peers.  The valuation may expand as Kandi increases market share in China, starts growing in new markets outside of China, and introduces new ancillary transportation-related services.

Company Overview

Kandi Technologies Group, Inc. (KNDI), headquartered in Jinhua Economic Development Zone, Zhejiang Province, is engaged in the research, development, manufacturing, and sales of various vehicular products. Kandi conducts its primary business operations through its wholly-owned subsidiary, Zhejiang Kandi Vehicles Co., Ltd. (“Kandi Vehicles”) and its subsidiaries, SC Autosports, LLC, the wholly-owned subsidiary of Kandi in the United States and Fengsheng Automobile Technology Group Co., Ltd (formerly known as Kandi Electric Vehicles Group Co., Ltd., the “Affiliate Company”). Kandi Vehicles has established itself as one of China’s leading manufacturers of pure electric vehicle parts and off-road vehicles.

More information about KNDI is available on the Company’s corporate website at http://www.kandivehicle.com. The Company routinely posts important information on its website.

 

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