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<Research>CMS: BYD COMPANY's Strategy to Price EVs Below ICEVs Effective; ST/MT/LT Growth Basis Solid
Recommend 6 Positive 10 Negative 5 |
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China Merchants Securities commented in a report that BYD COMPANY (01211.HK)'s strategy to price electric vehicles (EVs) lower than internal combustion engine vehicles (ICEVs) has been effective, with a solid foundation for short-, medium- and long-term growth. The company's sales target guidance is on the conservative side, with an annual sales target of more than 20% growth, or more than 3.6 million vehicles. The broker estimated that this is the lower limit of the company's target, and that if the market expansion goes well, the sales volume is expected to hit 3.7-3.9 million vehicles. On the export front, CMS said BYD's export volume in the first three months has exceeded expectations, and the broker now forecasted the annual export volume to be over 500,000 vehicles, which is higher than the company's original guidance of 400,000-500,000 vehicles. Although the market remained worried about the impact of low-end market competition on BYD's profitability, CMS believed the company has leveraged its excellent integration advantage to reduce costs with technology-driven and scaling capabilities. Meanwhile, the rapid growth of exports and the increase in the proportion of high-end models would enhance profitability. CMS maintained its Overweight rating on BYD, with a target price of $300. AAStocks Financial News |
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