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<Research>Citi Adds NIO-SW (09866.HK) to Upside Catalyst Watch List for Next 30D
Recommend 9 Positive 12 Negative 9 |
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After NIO announced its results, its US shares (NIO.US) soared 14.4% to close at US$4.85. Citi Research released a report, placing NIO-SW (09866.HK) on its Upside Catalyst Watch List for the next 30 days, with a Buy rating and a target price of HK$53.7. Citi expected NIO to report other income of RMB1.86 billion in 3Q24, with negative gross margin narrowing to -9.5% (vs -12.3% in 2Q24). The broker expected the company's consolidated average selling price (ASP) to rise QoQ by 1-2% in 3Q24, and vehicle gross margin to improve to 13.3-13.7%, with an improved product mix, higher ASP, and better economies of scale, which would imply a consolidated gross margin increase of 1.8 ppts to about 11.5%. Citi projected NIO's 4Q24 volume to continue to improve to 83,000 to 85,000 units, lifting 32% to 39% QoQ. The broker also does not expect any further refinancing plans for the automaker in the near term, as it expected working capital to continue to improve in 3Q and 4Q in line with QoQ revenue growth. The broker further predicted NIO to set a sales target of 400,000-450,000 units for the later stages of FY25. AAStocks Financial News |
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