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<Research>Citi Cuts BRILLIANCE CHI (01114.HK) TP to $4.42; Painful BMW China Destocking Ahead
Recommend 17 Positive 22 Negative 7 |
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According to Citi Research, Brilliance-BMW’s omni-channel (factory and dealer) inventory was expected to rise notably from 0.6 months at the end of June to 2 months at the end of August. In view of that Brilliance-BMW has to face the pressure of destocking in 4Q24, Brilliance-BMW’s capacity utilization was forecast to be impaired by the decline in production volume and the increase in rebates offered by distributors to boost consumer demand. This may have a certain impact on its sales volume and profit. Considering the worse-than-expected sales trend, the broker lowered Brilliance-BMW’s sales forecasts to 662,000/ 659,000/ 638,000 units in 2024-26 respectively, with NPM falling to 8.8%/ 7.5%/ 6.9% respectively. The NP forecast was also cut to RMB4.02 billion/ 4 billion/ 3.59 billion for each year. The broker lowered its target price from HKD5.68 to HKD4.42 and maintained its Buy rating. AAStocks Financial News |
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