The Zhitong Finance App learned that MeiDong Auto (01268) fell by more than 6%. As of press release, it was down 6.01% to HK$2.97, with a turnover of HK$7.9413 million.

According to the news, the “China Auto Dealer Inventory Warning Index Survey” previously released by the China Automobile Dealers Association shows that in December 2023, the China Auto Dealer Inventory Warning Index was 53.7%, down 4.5 percentage points year on year, down 6.7 percentage points from month to month. The inventory warning index is above the boom and bust line, and the automobile dealership industry is still in a sluggish range. Looking ahead to 2024, dealers believe that demand for automobiles will continue to grow in the second half of 2023, but competition will be more intense, and they will continue to face problems such as falling new car prices, high inventory pressure, tight capital, and low bicycle profits.

According to the Yamato Research Report, the target price was lowered from “buy” to “own” and the target price was lowered from HK$7.9 to HK$3.4. It is believed that compared with new luxury electric vehicles, the competitiveness of traditional luxury cars has declined, and it is expected that the market share will continue to be lost in the future. The bank expects weak performance in the second half of 2023 due to dealers' promotions during the period and possible impairment of goodwill due to the acquisition of star-chasers. Furthermore, it is estimated that the average sales price and gross margin of new cars during the period will be weaker than in the first half of 2023 due to more intense price competition; after-sales revenue is expected to remain stable, and the year-on-year growth rate is high in double digits.