Profit forecasting and investment advice

We expect the company to sell 0.49/0.69/0.83 million new vehicles (flat) in 2024/25/26, respectively, with revenue of 144/203.6/246.8 billion yuan (flat), net profit to mother of 6.8/12.5/17.8 billion yuan, and EPS of 3.20/5.88/8.39 yuan respectively (flat). Considering that the NEV industry is still developing rapidly, we used the PS method to value the company. The closing market value on September 24, 2024 was 1.2/0.9/0.7 times the 2024/25/26 PS, respectively. Referring to comparable companies, we gave the company 1.3 times PS in 2024, corresponding to a reasonable target price of HK$96.70 (converted at the exchange rate of HK$1 = RMB 0.9124; the same as the previous target price). Maintain an “better than the market” rating.

Risk warning: Economic growth falls short of expectations, and raw material prices have risen sharply.