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Hello dear regards, while Tesla is going to the moon there are companies that could benefit from tailwind. I decided, after December deliveries hit a record of 15,815 cars, to YOLO all of my money into NIO without considering any other factors like macroeconomic situation, Chinese politics or the fact they didn’t make a profit yet.

Obviously now, four weeks after my purchase, it’s time to think about my investment. Options only of course.

To minimize risk a bit I’ve decided to take a longer time frame, €22,000 on 1/24 $14 calls (my tiny brain tells me there’s no risk at all), €21,000 on 6/23 $16 (could lose half of my investment which is okay) and €2,100 on 3/23 $15 (risky but compared to the rest a „tiny“ amount).

You guys see there’s already a profit made but I wouldn’t be here if I was a reasonable and rational guy. The options are still OTM and I can see all of em reach ITM status until beginning of March.

Let me explain why (my thoughts are one dimensional so better don’t follow if you are attached to your money):

There are no exact numbers of deliveries for January yet but you can get a picture of approximate numbers if you take a look at weekly registration numbers. We need to know there were 9,652 cars delivered in January 2022. This needs of course to get beat to move the price.

First week of January we count 2,818 registrations in China, second week 2,963. Makes 5,781 until January 15th. So far so bad. They are still struggling a bit, but the amount of deliveries is ok considering the problems China had and has lately. To make things in January worse Chinese new year holidays were last week from 21st to 27th. So for sure not the best month in their history. But that should be priced in. And I think despite all the negative factors they’ll still manage to beat last years deliveries easily and from here on it’s getting started.

First let’s take a look on last years deliveries:

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We see horrible numbers in February 2022. If NIO just keep staying at the level they’re at the moment (~2,900 registrations per week) they will grow approximately 90% YoY in February. If they increase and go beyond 3,000 deliveries per week like in November and December 2022 already we face more than 100%. The stock market likes growth of 100% and more. Why should they get back at the level from December you may ask. Shanghai just recently (yesterday, so most probably not priced in yet) extendet it's $1,500 subsidies for EVs until December 2023. And it's starting on February 1st again. NIO is pretty big in Shanghai already. Interesting side note btw:

The policy was first released in Shanghai last May and was valid until the end of 2022.

NIO hasn’t delivered less than 10,000 cars per month since May 2022 and hopefully never will again and their outlook is around 70-80k cars in H1 and 140-150k cars in H2 of 2023. CEO Li was talking about at least surpassing Lexus in China (around 200k) in 2023. They are pretty confident about at least 50% growth.

And to talk about profitability eventually, „NIO is still losing money, but mainly due to R&D investment, and the company's gross profit has largely covered its overall operating costs, according to Qin.“

Interview from president Qin Lihong from January 26th 2023.

https://cnevpost.com/2023/01/28/nio-president-further-details-sub-brand-nio-phone/

I won't start talking about many other aspects that could be bullish or bearish (phone, battery swaps, Neopark phase II and the sub-brands ALPS and Firefly, etc.) so no real DD at all. I just wanted to share my YOLO to get you guys excited for a potential nice loss porn you can fap to or a good gain for me I can fap to.

See you in Valhalla