| Valuation method | Value, $ | Upside, % |
|---|---|---|
| Artificial intelligence (AI) | 22.76 | 47 |
| Intrinsic value (DCF) | 7.64 | -51 |
| Graham-Dodd Method | 12.92 | -16 |
| Graham Formula | 7.79 | -50 |
Triangle Tyre Co., Ltd is a leading Chinese tire manufacturer with a comprehensive global footprint, founded in 1976 and headquartered in Weihai, China. The company specializes in researching, developing, designing, manufacturing, and marketing a diverse range of tire products including commercial tires, passenger tires, and specialized off-the-road (OTR) tires for various applications. Operating in the auto parts sector within the consumer cyclical industry, Triangle Tyre has established an extensive distribution network spanning 180 countries and regions across North America, Europe, Australia, Russia, and India. The company's vertically integrated operations from R&D to global marketing position it as a significant player in the competitive global tire market. With its strong presence in emerging markets and growing penetration in developed economies, Triangle Tyre represents China's manufacturing capabilities in the automotive components sector, leveraging cost advantages and scale to compete internationally while maintaining quality standards that meet diverse regional requirements.
Triangle Tyre presents a mixed investment profile with several attractive fundamentals offset by sector-specific challenges. The company demonstrates solid profitability with net income of CNY 1.10 billion on revenue of CNY 10.16 billion, representing a healthy 10.9% net margin. With a market capitalization of CNY 11.11 billion and a beta of 0.455, the stock shows lower volatility than the broader market, potentially appealing to risk-averse investors. The company maintains a strong liquidity position with CNY 2.46 billion in cash against CNY 1.26 billion in total debt, providing financial flexibility. However, the tire industry faces headwinds from raw material price volatility, global supply chain pressures, and intense competition from established global players. The company's exposure to international markets (180 countries) provides diversification but also exposes it to currency fluctuations and trade policy risks. The dividend yield based on CNY 0.53 per share provides income appeal, but investors should monitor raw material costs and global automotive demand cycles which significantly impact tire manufacturers.
Triangle Tyre operates in a highly competitive global tire market dominated by established multinational corporations with stronger brand recognition and larger R&D budgets. The company's competitive positioning is primarily built on cost leadership and manufacturing scale advantages typical of Chinese industrial exporters. Its comprehensive product portfolio covering commercial, passenger, and specialized OTR tires allows it to serve multiple market segments, though it lacks the premium brand cachet of global leaders. Triangle's extensive global distribution network spanning 180 countries represents a significant competitive strength, particularly in emerging markets where price sensitivity is higher. The company's vertical integration from R&D to manufacturing provides cost control advantages, but it faces challenges in competing with the technological innovation and brand loyalty commanded by top-tier competitors. In the Chinese domestic market, Triangle benefits from local manufacturing advantages and understanding of regional requirements, but faces intense competition from both state-owned enterprises and private tire manufacturers. The company's moderate beta of 0.455 suggests it's less volatile than pure commodity plays, reflecting its established market position and diversified customer base. However, its ability to move up the value chain into higher-margin premium segments remains constrained by brand perception and technological capabilities compared to global leaders who invest significantly more in R&D and marketing.