Key points of investment

In September 2024, Ideal Auto delivered 53,709 new vehicles, a year-on-year increase of 48.9%. A total of 152,831 vehicles were delivered in 2024Q3, an increase of 45.4% year over year. A total of 341,812 vehicles were delivered in January-September 2024, an increase of 40.0% year over year. As of September 30, 2024, the cumulative delivery volume of Ideal Cars reached 975,176 units.

In September, Ideal Auto delivered 53,709 new vehicles, a year-on-year increase of 48.9%. The 2024Q3 ideal delivered a total of 152,831 vehicles, and a total of 341,812 vehicles were delivered in January-September. Sales of Ideal reached a new high in September, and orders for the L series and Ideal MEGA increased steadily. In terms of channel layout, as of September 30, Ideal Auto has 479 retail centers across the country, covering 145 cities; 436 after-sales maintenance centers and authorized sheet spray centers, covering 221 cities. Ideal Auto has put into use 894 ideal overcharging stations across the country, with 4,286 charging stations. In September, the efficiency of the Ideal Auto Store was 112 vehicles per home, +12.1% compared to the previous month.

The ideal smart driving fast and slow system was re-iterated, and the OTA 6.3 function was optimized and upgraded. Ideal intelligent driving end-to-end +VLM switches to a new AI model, 3 millionclips video clip training, more comfortable lane changes, more advanced braking, and a more reasonable path. Help enable parking and exit from parking space to parking space, and ETC access at high-speed toll gates throughout the country. The September Ideal OTA 6.3 push update added 15 features, optimized 17 functions, AD Pro added erroneous acceleration suppression, and assisted AEB emergency braking to enhance active safety; the speed limit offset was finely adjusted and upgraded, and the speed limit offset was refined to ± 5 km/h speed limit offset value and ± 5% speed limit offset percentage.

Profit forecast and investment rating: We maintain the company's 2024-2026 operating income forecast of 146.3/191.8/250.7 billion yuan, respectively, +18%/+31%/+31% year-on-year, and net profit to mother of 7.5/12.1/17.6 billion yuan, respectively, -36%/+61%/+45%, respectively; corresponding to 2024 to 2026 EPS of 3.55/5.72/8.28 yuan, corresponding to PE of 27/17/12 times, maintaining the company's “buy” evaluation grade.

Risk warning: The industry price war continues to be interpreted; the pace of development of advanced smart driving is lower than expected.