SunCar expands strategic EV partnership in China

NEW YORK - SunCar Technology Group Inc. (NASDAQ: SDA), a company specializing in auto e-insurance and cloud-based B2B auto services in China, has announced a significant expansion of its strategic partnership with a leading global electric vehicle (EV) manufacturer. The company, currently valued at $512 million and identified as undervalued according to InvestingPro analysis, has shown strong revenue growth of 29.36% in the last twelve months. This collaboration, which began in early 2024, has seen rapid growth, with the premium volume for automotive insurance brokerage services increasing from $400,000 in January 2024 to approximately $40 million by the end of the year. Despite this growth, InvestingPro data reveals the company operates with relatively weak gross profit margins of 11.97%, suggesting room for operational improvement.

The partnership has extended its reach across 48 Chinese cities, with over 2 million of the partner’s electric vehicles now on the road in China. SunCar has developed an e-insurance system designed to simplify the insurance renewal process for this expanding customer base. The system’s success reflects the strong market demand and SunCar’s effective service delivery model.

In 2025, SunCar plans to broaden its geographical presence and further integrate its technology. A notable advancement is the integration of SunCar’s automotive services into the EV manufacturer’s owner platform, aiming to enhance the user experience for millions of vehicle owners. This move signifies a leap in digital automotive service delivery.

SunCar’s AI-powered infrastructure is central to the company’s service optimization and resource allocation. Serving over 2 million EV owners, the infrastructure underlines SunCar’s technological prowess and market penetration. This digital transformation is setting new benchmarks for efficiency and customer service in the automotive sector.

Ye Zaichang, Chairman and CEO of SunCar Technology Group Inc., stated that the company is at the forefront of introducing AI-driven solutions to meet the changing needs of vehicle owners. The partnership’s growth not only solidifies SunCar’s position in the burgeoning Chinese electric vehicle market but also underscores its commitment to technological excellence in service.

Founded in 2007, SunCar has become a leader in China’s B2B auto services and auto eInsurance markets, particularly for electric vehicles. Its intelligent cloud platform connects drivers with a variety of auto services and insurance options through a nationwide network of sales partners. While the company maintains a moderate debt level with a debt-to-capital ratio of 0.13, InvestingPro subscribers have access to 12 additional key insights about SDA’s financial health and market position, along with detailed valuation metrics and growth forecasts.

Please note that this article is based on a press release statement.

In other recent news, SunCar Technology Group has been making strategic financial moves. The company recently launched a share buyback program, with a target of up to $30 million of its outstanding Class A ordinary shares over the next 12 months. This decision reflects SunCar’s belief in its future growth and its commitment to delivering shareholder value.

In addition to the buyback program, SunCar announced a follow-on public offering of up to $50 million of its Class A Ordinary Shares. The proceeds from this offering are earmarked for working capital and general corporate purposes. BTIG, LLC, Macquarie Capital Limited, and Oppenheimer & Co. Inc. are serving as bookrunners for this offering.

In terms of personnel changes, SunCar has appointed Breaux Walker as the company’s Chief Strategy Officer. Walker brings over two decades of experience in business development, corporate finance, and cross-border transactions, particularly in the technology and fintech sectors.

BTIG analysts have maintained their Buy rating on SunCar, with a price target of $12. This comes after SunCar’s secondary share offering and subsequent stock price movements. The analysts have highlighted that there have been no significant developments that could be driving the stock price decline other than the secondary offering itself. They also argue that SunCar’s shares should trade at a premium to its peers, not at a discount or parity.

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