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<Research>G Sachs Lowers XPENG-W (09868.HK) TP to $41; 3Q24 Guidance Below Expectations
Recommend 18 Positive 23 Negative 10 |
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Goldman Sachs wrote in a report that XPENG-W (09868.HK)'s 2Q24 results were in line with predictions, but its 3Q24 guidance was below expectations. Mona, XPENG's sub-brand, will launch its first model, the M03, next Tuesday (27 Aug), with deliveries starting in September. The broker expected sales of the M03 to be 7,500, 8,500, 9,500 and 10,500 units in each of the months from September to December amid increased production. Compared with similar products in the market, i.e.NEV sedans priced between RMB100,000 and RMB150,000, the higher-end Aion S by GAC Aion and Qin Plus EV by BYD COMPANY (01211.HK) saw monthly sales volume reached about 20,000 units, while low-end counterparts had monthly sales volumes of 3,000 to 4,000 units. Goldman believed demand for the M03 would be strong as it scored one of the highest compared with peers in its class based on key indicators, such as price, range and size. XPENG management is also confident that M03's delivery in September will likely set a record for the fastest delivery of a battery EV model produced by an EV startup. The current record is made by XIAOMI-W (01810.HK)'s SU7, which delivered 7,058 vehicles in April this year. Considering M03's lower pricing compared to SU7, if M03 delivers 7,500 units in September, it would set a record for first-month deliveries by XPENG, and demonstrate the automaker's improved supply-chain management capabilities. The broker adjusted XPENG's non-GAAP net profit forecasts for 2024/25/26 to losses of RMB6.4 billion, RMB6.9 billion and RMB5.6 billion from the originally forecasted losses of RMB5.4 billion, RMB6.9 billion and RMB5.1 billion, reflecting lower guidance for sales volume in 3Q24, higher gross profit margins due to cost reduction, and higher operating expenses in 2H24. Goldman dropped its target price on XPENG by 13% to HK$41 and maintained its Buy rating. AAStocks Financial News |
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