In 2024, BYD sold 4.25 million new energy passenger vehicles, exceeding the sales target. We are optimistic that with its strong technical advantages and cost advantages, BYD can guarantee a steady increase in market share and performance in the fierce industry competition. Maintain the target price of HK$340.0, corresponding to the predicted price-earnings ratio of 17.3 times over 25 years. There is room for a 32% increase from the current price, and the purchase rating is maintained.

Report summary

Exceeded 24-year sales target. In December, BYD's sales reached 0.509 million units, up 49.7% year on year. Of these, pure electric passenger cars sold 0.208 million units, up 8.9% year on year, and plug-in hybrid passenger car sales were 0.301 million units, up 101.9% year on year. Throughout 2024, the company sold 4.25 million new energy passenger vehicles in wholesale sales, an increase of 41.1% over the previous year. Electric passenger car sales increased 12.1% year-on-year to 1.765 million units. Plug-in passenger car sales were 2.485 million units, up 72.8% year over year. New Energy's overseas sales volume in December was 0.057 million vehicles, up 58.3% year on year. In 2024, a total of 0.417 million units went overseas, up 71.9% year on year. It has set a new record for new energy sales by Chinese car companies in overseas markets.

The new car matrix is in full swing. The BYD brand's first high-end MPV Xia is expected to be launched on January 8. The blind subscription price is 0.2898 million-0.35 million. The new car is equipped with fifth-generation DM technology, equipped with technology such as Yunnan-C intelligent damping body control system and Dipilot intelligent driving assistance system. In the first half of the year, BYD will also launch the dynasty's flagship models Han L, Tang L, and Tense N9. Judging from the naming method, the new Han L and Tang L are both larger in size than the current models. The Tang L is positioned as a medium to large SUV, while the Han L is positioned as a medium to large sedan. Both the Tang L and Han L will be equipped with fifth-generation DM hybrid technology, while the pure electric models will use second-generation blade batteries, which are expected to last more than 1,000 kilometers.

Increase investment in intelligent driving, multi-line concurrency, and make every effort to catch up with technology. In recent years, BYD has listed intelligent driving as one of its core strategies, and has carried out multiple rounds of optimization and restructuring of related R&D teams. With regard to L2 low-level autonomous driving, BYD has achieved completely independent research and development through its deep technical accumulation. BYD has an open and inclusive cooperative attitude towards high-end smart driving, and adopts a dual-track model of self-development and collaborative supplier development. Partners include Momenta, Horizon, and Huawei. In December '24, BYD's advanced intelligent driving assistance system “Eye of Tenjin” was launched OTA to the Looking Up U8, Tense Z9GT, and Tense N7. The Touchless City Pilot function was launched nationwide, representing a new breakthrough for BYD in the field of intelligent driving.

Investment advice. We are optimistic that with its strong technical advantages and cost advantages, BYD can guarantee a steady increase in market share and performance in the fierce industry competition. Maintain the target price of HK$340.0, corresponding to the predicted price-earnings ratio of 17.3 times over 25 years. There is room for a 32% increase from the current price, and the purchase rating is maintained.

Risk warning: industry competition intensifies; prices fall short of expectations