New Power Leader "Top Spot" Faces Frenetic Hour, Seres Plunges to Halt Amid Fund Abandonment

On June 25th, Seres (601127.SH), a company with a market value of tens of billions, saw a massive sell-off with nearly ten billion yuan in trading volume, closing at 85.71 yuan, with a total market value of 129.4 billion yuan. Today's trading halt also cost Seres the top spot in market value among new automotive forces, which it had just claimed a week ago. Affected by the trading halt of this stock, BAIC BluePark (600733.SH), JAC Motors (600418.SH), Dongfeng Motor (600006.SH), and Changan Automobile (000625.SZ) also followed suit with declines.

Since the beginning of its cooperation with Huawei, Seres has seen a cumulative increase of more than ten times, reflecting the market's expectations for the sales volume of the AITO series models. In the absence of any fundamental bearish news, the emergence of a large number of sell orders and a trading volume of nearly ten billion yuan has led to a sudden trading halt and sparked various speculations in the market.

Reporters have noticed that there are market rumors that "GF Fund Manager Liu Ge Rong, in response to the liquidity pressure caused by the continuous decline of photovoltaic stocks, cut his position in Seres, leading to the trading halt." When reporters confirmed this situation with GF Fund, they received a response: "It's just a rumor."

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The sudden trading halt occurred in the last hour, with funds targeting Seres. By noon, Seres' stock price had only fallen by 1.46%. Starting at 1:50 PM, with the trading volume increasing, Seres' decline reached 8%, and it soon touched the trading halt for the first time. Although the bulls made several attempts before the close, they ultimately failed to overcome the bears, and there were still 22,000 sell orders hanging at the close of the trading halt.

This year, Seres' stock price has continued to rise, reaching a historical high of 106.66 yuan on March 18th (adjusted for rights, the same below). A week ago, the company's total market value had just surpassed Li Auto, topping the list of new automotive forces in market value.

Since the beginning of this week, there have been no major bearish news about Seres' fundamentals, and the sudden trading halt has left investors at a loss and sparked heated discussions in the market.

Today, there are market rumors that "GF Fund Manager Liu Ge Rong, in response to the liquidity pressure caused by the continuous decline of photovoltaic stocks, cut his position in Seres, leading to the trading halt." In response, GF Fund stated: "It's just a rumor."

Since the third quarter of 2021, several fund products under Liu Ge Song have been among the top ten circulating shareholders of Seres. Financial reports show that as of the end of the first quarter of this year, GF Technology Pioneer, GF Industry Strict Selection Three-Year Holding Period, and GF Small Cap Growth are the eighth, ninth, and tenth largest circulating shareholders of Seres, with holdings of 8.7093 million shares, 8.449 million shares, and 6.7043 million shares, respectively, accounting for a total holding ratio of 1.58% of the total share capital.GF Technology Pioneer and GF Industry Strict Selection Three-Year Holding Period, two products, both had Sunshine Power (300274.SZ) as their top holding stock as of the end of the first quarter, which closed down 5.31% today, marking the largest daily drop since January 29th this year. Among them, Jin Ao Technology (002459.SZ), a heavily weighted stock in GF Technology Pioneer, hit a new low since September 11, 2020, today. Another heavily weighted stock, Trina Solar (688599.SH), closed down 2.13%, continuing to set a new low since July 2021.

Since the fourth quarter of 2023, the aforementioned three funds managed by Liu Gesong have continued to sell off shares of Seres. In the fourth quarter of last year, they sold 18.113 million shares, and in the first quarter of this year, they collectively reduced their holdings by over 3 million shares.

Data from Oriental Choice shows that, as of the end of the first quarter, in addition to the aforementioned three funds that are among the top ten shareholders, the GF Dual Engine Upgrade Mixed A, GF Innovation Upgrade, and GF Diversified Emerging managed by Liu Gesong held 6.5059 million, 3.4798 million, and 2.1291 million shares of Seres, respectively.

Focus on the second-quarter performance

During the regular disclosure period of A-share reports, some stocks that may not meet performance expectations will be preemptively sold off by funds. In response to today's trading halt of Seres, some market participants speculate that the company's mid-year report performance may not meet expectations.

In the first quarter, Seres was one of the few new energy vehicle companies that achieved profitability, with a single-quarter operating income and net profit attributable to the parent company of 26.561 billion yuan and 219 million yuan, respectively, with year-on-year increases of 421.76% and 134.12%, respectively, achieving a net profit for the first time.

Public information shows that sellers generally believe that Seres' first-quarter profit turnaround was better than expected. CICC and Galaxy Securities gave the company target prices of 124 yuan and 120.96 yuan, respectively, in research reports published in May-June. Most sellers believe that the accelerated delivery of the M9 model is expected to quickly improve Seres' profitability.

Looking at the latest production and sales flash report, there is no decline in Seres' sales volume. The company's total sales volume in May was 38,600 units, a year-on-year increase of 130.8%, and from January to May, the company's total sales volume was 186,600 units, a year-on-year increase of 154.2%.

From a stock price of less than 10 yuan in 2020 to a historical high of 106.66 yuan, Seres' stock price has increased more than tenfold in four years, benefiting from the company's cooperation with Huawei. In December 2021, Seres launched the Enovate brand in deep cooperation with Huawei, introducing the first model, Enovate M5, and the subsequent cooperation between the two parties has become increasingly close, successively launching the M7 and M9 models as Huawei's smart selection models.

"The trend of stock prices is the result of the combined efforts of all parties in the market. The market's profit expectations for Seres have been reflected in the stock price increase over the past 3-4 years, and may have even overdraw the performance growth of the next few years. The company's performance in the first quarter of this year has turned a profit, and it is actually time to cash in on expectations," a new energy analyst told the reporter.