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<Research>JPM: LI AUTO-W (02015.HK) 3Q Swings to Loss on One-time Recall Costs; Rating Kept Neutral
Recommend 3 Positive 6 Negative 0 |
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LI AUTO-W (02015.HK)'s unexpected shift from profit to loss in 3Q25 was primarily due to one-time recall costs amounting to approximately RMB1.1 billion, JPMorgan said in a research report. Excluding this factor, the margin and profit during the period largely met expectations. However, the group's sales guidance for 4Q25 was 20% below JPMorgan's and market's expectations, a trend similar to that observed with peers NIO-SW (09866.HK) and XPENG-W (09868.HK), as NEV demand did not saw a meaningful rebound ahead of subsidy expiry by year-end like last year. The management's outlook for margins in 4Q25 and 1Q26 also raised concerns for JP Morgan. Consequently, JPMorgan revised down its 2026 sales and earnings forecasts by 15% and 82%, respectively, maintaining a Neutral rating and lowering the target price for Li Auto (LI.US)'s US shares to US$18 and its Hong Kong shares to HK$73. AASTOCKS Financial News Website: www.aastocks.com |
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