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<Research>CLSA: Meager Orders Prompt CN Automakers to Cut Prices Again; Top Pick BYD
Recommend 55 Positive 94 Negative 54 |
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During the week from May 19 to 25, orders from 12 major electric vehicle (EV) manufacturers in China lost 7% WoW, CLSA said in its report. In the mass market, BYD COMPANY (01211.HK) seized 70,000 orders during the period, with price cuts receiving a positive response. GEELY AUTO (00175.HK)'s orders numbered 21,000, below the 23,300 the previous week. LEAPMOTOR (09863.HK)'s orders subsided from 9,700 to 8,700. Channel sources divulged that Leapmotor's C11 and C16 models are offering a RMB3,000 discount in response to BYD's price cuts. In the mid-to-high-end market, XIAOMI-W (01810.HK)'s orders receded from 50,000 last week to 45,000, affected by recent negative media reports swaying buyer interest, while the market estimated the YU7 to be priced at RMB220,000. As for LI AUTO-W (02015.HK), orders remained resilient at 10,000 units. XPENG-W (09868.HK)'s orders sank from 7,100 to 6,800. The broker foresaw that price pressure will persist in the short term, exerting pressure on sector margins, while new technologies and exports were expected to act as catalysts to improve sales structure and margins. As for stocks, CLSA viewed BYD to be relatively advantageous due to its strong export momentum, setting a TP of HKD483 for H shares. The broker believed Geely's product cycle can render some support, with a TP of HKD23, both rated as Outperform. AASTOCKS Financial News Website: www.aastocks.com |
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