Tag: Investing

Tesla SOTP… $360bn?

Two biggest component would be electric vehicles and AI.

EV: BYD is <$100bn; BYD delivered higher profits than Tesla; BYD also has energy storage business

AI Models (FSD): OpenAI is <$100bn; latest valuation appeared to be $86bn

AI Chips: AMD is ~$160bn. Tesla should be years behind in terms of external revenue profits (as a business) etc. Let’s just use $160bn, as Tesla has some other business.

Then it sums up to be $360bn = $100bn + $100bn + $160bn

Last time I checked (before earnings), it’s more than doubling that number…

Robots? Boston Dynamics was $1.1bn back in Dec 2020.

Charging? ChargePoint ($CHPT) is ~$1bn market cap.

If someone wants to add ride-hailing services I mean Lyft is <$5bn, not significant.

Even additionally add Enphase and First Solar, which were ~$13bn and $16bn, still not big enough to move the needle.

Insurance could be big. However, if it’s not good enough/taking over now, why it should be in the future? It shouldn’t be a futuristic thing; auto insurance has a history of over 100 years.

$400bn or lower sounds about right.

Investing in China: regulation and justice

It’s difficult to understand each regulation. But I think there is a better, more fundamental and actually easier way – through the lens of justice.

However, there seems to be a difference between what China focuses on vs. the West when it comes to justice. In short, I feel that China weighs a fair outcome over procedural justice.

This difference could partially be explained by the fact that China doesn’t always operate based on exact rules. It could be hard to develop a robust law system in a short period of time and in an evolving society. In fact, rules can be modified to suit the needs, which is the opposite of mainstream western belief. 

When big global companies may get away with perfectly executed deals, Chinese companies may face the consequences afterwards (even before regulation is in place). After all, trouble may come in various forms.

That being said, justice is important. A company may build goodwill to offset any negative consequences it may create, especially formalized in the future. For example, Tencent’ gaming business is lucrative and from time to time is seen to have negative impacts on teenagers. Although Tencent could be procedurally perfect and compliant, it may not be enough. I believe it’s the WeChat etc. that brings a good amount of positive progresses that provide a cushion. Therefore, as those balanced out, it’s not injustice for Tencent to make such a large sum of money.