Goldman Sachs released a research report stating that it maintains a "Buy" rating on TUHU-W (09690), with the Target Price raised by 8.8% from HKD 22.5 to HKD 24.5. The firm expects that TUHU, as the largest online and offline comprehensive Car Service platform in China, will enjoy sustained operating leverage and efficiency improvements, thereby reducing the operating expense ratio. In addition, with the improvement in gross margin, this should lead to years of operational profit expansion, with a projected compound annual growth rate of 35% for Net income from 2023 to 2026.

Goldman Sachs believes that TUHU is the largest independent aftermarket (IAM) supplier in China. With its lower and more transparent pricing and revenue-generating capabilities, TUHU has become a net beneficiary in the current environment. Although car manufacturers expanded slowly in the first half of this year, Goldman Sachs expects accelerated capacity expansion in the second half of the year, estimating that the number of car manufacturers will reach 6,800 to 6,900 by the end of the year. Looking ahead to the second half of this year, the firm expects TUHU's income to grow by 9% year-on-year to 7.7 billion yuan, with adjusted Net income increasing by 41% year-on-year to 0.378 billion yuan, indicating an adjusted net margin of 4.9%.