CICC has released a research note indicating that GAC GROUP (02238) is planning a significant asset restructuring. If this restructuring is successfully completed, it could set a crucial precedent for cross-regional integration among central and local state-owned automakers. The move is anticipated to send a positive signal against involution, potentially lifting market sentiment, although the specifics of the restructuring, its outcomes, and its impact on the industry landscape are still uncertain.

According to the report, GAC GROUP and FAW Co., Ltd. signed a letter of intent on September 14. The plan involves GAC GROUP issuing new shares to acquire a portion of the equity in a certain vehicle joint venture held by FAW, along with raising matching funds. Following this transaction, FAW is expected to become GAC GROUP's second-largest shareholder with significant strategic influence. This deal is expected to constitute a major asset restructuring and a related-party transaction, without altering the actual controller of GAC GROUP or constituting a backdoor listing. Key terms such as the target asset's name, transaction ratio, and valuation have not yet been announced, and the final plan is still subject to a formal agreement and regulatory approvals.

The report notes that FAW maintains a relatively solid operational base. Its Hongqi brand possesses a foundation in independent luxury vehicles, and its joint ventures contribute steady sales and profits. However, there remains room for improvement in its independent new energy vehicle scale, intelligent driving iteration, and presence in the southern market. Meanwhile, GAC GROUP is in a phase of new energy transformation and profit stabilization. The complementary resource endowments of the two parties could create strong synergies. If high-quality joint venture assets are injected into GAC GROUP, it could help improve its income statement to some extent. For FAW, this could facilitate the securitization of some of its joint venture assets, using the capital to expand its ecosystem. In the medium to long term, further cooperation between the two parties is expected in areas such as intelligent electric R&D platforms, joint procurement cost reduction, integration of north-south sales channels, global expansion, and coordination of joint venture resources.