asia vets APP learned that haitong sec released a research report stating that it maintains a "outperform the market" rating for li auto inc (02015), expecting to sell new cars in 2024/25/26 of 0.51/0.71/0.85 million units, with revenues of 146/206.4/250.2 billion yuan, net income attributable to shareholders of 7.6/13.4/18.9 billion yuan, and a fair value range of 105.56-113.1 Hong Kong dollars.

The main points of Haitong Securities are as follows:

li auto inc released audited financial performance for the quarter ended September 30, 2024.

In Q3 2024, the company achieved total revenue of 42.9 billion yuan, up 24% year-on-year and 35% quarter-on-quarter; net income was 2.8 billion yuan, up 0.3% year-on-year and 156% quarter-on-quarter. The company expects car deliveries in Q4 2024 to be between 0.16 million and 0.17 million units, with a year-on-year range of +21.4% to +29.0%; corresponding revenue is expected to be between 43.2 billion yuan and 45.9 billion yuan, with a year-on-year range of +3.5% to +10.0%.

Q3 2024 saw an increase in delivery volume on a quarterly basis.

Based on the company's performance announcement for Q3 2024, a total of 0.153 million new cars were delivered, up 45% year-on-year and 41% quarter-on-quarter. Calculations show that the per-vehicle revenue for Q3 2024 was about 0.27 million yuan, down -0.049 million yuan year-on-year and down -0.009 million yuan quarter-on-quarter. The bank believes that the decline in per-vehicle revenue in Q3 2024 on both year-on-year and quarter-on-quarter basis was mainly due to an increased proportion of the Ideal L6 model priced below 0.3 million yuan in the total deliveries for Q3 2024. According to the wholesale sales volume data from the China Passenger Car Association, Ideal L6/L7/L8/L9 delivered 7.5/0.034/0.019/0.022 million units in Q3 2024, accounting for 49%/23%/13%/14% of the total deliveries, with year-on-year changes of +49/-15/-20/-16% and quarter-on-quarter changes of +13/-6/-2/-4%.

Continued cost reduction and efficiency improvement led to an increase in gross margin in Q3 2024.

According to the company's third quarter performance announcement for 2024, the company has achieved significant cost reduction and efficiency improvement results, with a gross margin of 21.5% in 24Q3, a year-on-year decrease of -0.5 percentage points, and a quarter-on-quarter increase of +2.0 percentage points.

The expense ratio decreased quarter-on-quarter in 24Q3, while the net margin increased quarter-on-quarter.

According to the company's third quarter performance announcement for 2024, the company's net margin in 24Q3 was 6.6%, a year-on-year decrease of -1.5 percentage points, and a quarter-on-quarter increase of +3.1 percentage points. The SG&A/research and development expense ratios in 24Q3 were 7.8%/6.0%, with year-on-year changes of +0.5/-2.1 percentage points, and quarter-on-quarter changes of -1.1/-3.5 percentage points. The decrease in research and development expense ratio quarter-on-quarter was mainly due to the reduced design and development costs of new products and technologies, as well as reduced employee compensation.

End-to-end + VLM intelligent driving system initiates full-scale push, bullish on the high-end smart driving driven by intelligent driving.

With li auto inc's NOA fully pushed in July 24, and further enhancement of active safety capabilities, the proportion of orders for ADMax versions continues to increase, especially for models over 300,000 yuan, where the ADMax version accounts for nearly 70%. As of 24M9, li auto inc's total smart driving users reached 0.96 million people, with a cumulative smart driving distance of 2.4 billion kilometers, and NOA distance of 1.2 billion kilometers. On October 23, 24, li auto inc's end-to-end + VLM dual system intelligent driving solution has been fully pushed together with OTA 6.4 version telematics system. The industry is bullish on the further enhancement of intelligent capabilities driving up the company's high-end configuration sales volume.

Risk Warning: New car sales lower than expected; significant increase in raw material prices; electric vehicle model investment exceeds expectations.