2021Q4's revenue exceeded expectations and sales are expected to be strong in March. The company sold 98000 vehicles in 2021, with revenue of 21 billion yuan, a year-on-year increase of 259%. For the whole year, non-GAAP belongs to ordinary shareholders with a loss of 4.5 billion yuan. 2021Q4, the company achieved sales of 42000 vehicles, revenue of 8.6 billion yuan, a year-on-year increase of 200%, exceeding expectations. Non-GAAP belongs to common shareholders with a net loss of 1.2 billion yuan, narrowed from a loss of 1.5 billion yuan on Q3. The company's 2022Q1 guidelines are sales of 33500-34000 units and revenue of 72-7.3 billion yuan, with an increase of 144% Mel 147%. According to the Q1 sales guidelines, the company is expected to sell 14350-14850 units in March, returning to last year's Q4 sales level, showing the strong market demand for the company's products.
New models are launched in an orderly manner, and the sales and service network sinks at an accelerated pace. On the model side, the P5 model will be released in 2022, while the G9 is expected to start delivery in Q3. In 2023, the company plans to launch two new models based on two new platforms.
On the sales service network side, the company is expected to continue to encrypt sales stores, accelerate store sinking and improve store efficiency. By the end of 2021, the company had 357 stores covering 129 cities, of which the number of stores below first-tier cities accelerated in the second half of 2021, accounting for nearly 80 per cent. At the same time, as of January 17, 2022, the number of XPeng Inc.-branded supercharging stations has increased to 813, covering 337 cities, leading the industry in coverage.
Urban NGP is expected to arrive in mid-year OTA,XPILOT 4.0 is expected to land in 2023. XPeng Inc. 's planning on the intelligent driver side is very clear: 1) in the middle of every year, the company plans to divide the city OTA city NGP function into city OTA city NGP functions in accordance with the high-precision map approval process in the P5 model equipped with XPILOT 3.5. at that time, it may become the first mass production car company in China to develop the intelligent driving function of urban scene. 2) XPILOT 4.0: the company plans to officially launch XPILOT 4.0 in 2023 to further realize intelligent driving assistance in the whole scene. It is planned that at least 4 models (G9, two new models and existing model modifications) will support XPILOT 4.0 in 2023 to achieve more comprehensive use scenarios, wider geographical coverage and a better interactive driving experience.
At present, the company leads the industry in technology accumulation and user experience in intelligent parking and urban NGP. The software penetration rate of 2021Q4XPILOT 3.0 is close to 20%. We expect that XPeng Inc. 's intelligent driving technology iteration will speed up with the acceleration of mass production and entering robotaxi in the future. With the landing of XPILOT 4.0, the software penetration will be significantly improved.
Short-term gross margin is under pressure, and long-term gross margin is expected to reach 25%. The company's 2021Q4 gross profit margin is 12%, a month-on-month decline in 2.4pct, of which vehicle sales gross profit margin is 10.9%, a month-on-month decline of 2.7pct. This is mainly due to: 1) the proportion of sales of P5 models with low gross profit margin increased from 1% of Q3 to 18% of Q4, pulling down the overall gross profit margin; 2) the price of lithium battery increased greatly, which put some pressure on production capacity and cost side. We expect the pressure on the gross margin side to continue to 2022Q2jue 2022 full-year gross margin is expected to be just over 10%. However, the company has actively taken measures to offset some of the impact of rising battery costs: I) price increases for three models on sale in mid-March, ranging from 1.0 to 33000 yuan; ii) strengthen cooperation with a number of suppliers. In addition, the delivery of the Q3 G9 model with high gross margin is expected to improve the company's product structure and drive up the overall gross margin. In the long run, with the easing of fluctuations in raw material prices, the increase in the share of revenue from smart driving software, technological progress and economies of scale, the company's gross profit margin is expected to reach about 25%.
Investment advice: we continue to be optimistic that XPeng Inc. will gallop on the big track of new energy vehicles with the leading intelligent driving system. It is estimated that the company's sales in 2022-2025 will be about 610, 000 vehicles, with a total revenue of 432, 698, 000 and 1486 billion yuan in 2022-2025, with a net profit margin of-17%, 9% and-3%, respectively, for non-GAAP.
We give XPeng Inc. a target valuation of US $34.2 billion, a target price of HK $157.4 for (9868.HK) and a target price of US $40.20 for (XPEV.N), maintaining a "buy" rating. The current valuation does not include potential realization of smart cockpits, Robotaxi, robots, aircraft and so on. In the future, XPeng Inc. 's intelligent exploration is expected to bring more scientific and technological and commercial value to the company.
Risk tips: autopilot ability improvement and function landing less than expected risk, consumer software willingness to pay less than expected risk, model development and launch schedule is not as expected risk.