UBS said that due to Porsche's new strategy and the introduction of new BMW and Porsche models, Yongda Motor (03669) will increase the profit margin for new cars next year by 0.1 percentage points.
The Zhitong Finance app learned that UBS released a research report saying that it raised the rating of Yongda Auto (03669) from “neutral” to “buy,” and lowered the target price from HK$5.5 to HK$5. Also, the company's sales forecast for this year and next year was lowered by 3.6%/3.7%; the profit margin forecast for this year's new car was lowered by 0.6 percentage points, but due to Porsche's new strategy and the introduction of new BMW and Porsche models, the profit margin for new cars next year will be increased by 0.1 percentage points.
The bank believes that Yongda Motor's profit margin for new vehicles may bottom out this year and is expected to improve next year. This is because Porsche announced that it will reduce its supply to China from 82,000 to 75,000 vehicles next year; BMW will launch a new generation 5 series next year; and among car dealers listed in Hong Kong, Yongda has the largest number of NEV stores. The report also pointed out that it has noticed that the stock's dividend rate this year is about 8%, and believes that its current price seems unreasonable.