China Merchants International released a research report stating that mainland Electric Vehicles companies performed strongly last December, with high growth expected this year. During the policy vacuum period in January and February, quality stocks are being acquired at lower prices.

Among them, BYD Company (01211) delivered 0.509 million new energy Passenger Vehicles last month, an increase of 49.8% year-on-year and 1.1% month-on-month; total deliveries for the year reached 4.25 million units, up 41.1% year-on-year. The forecast for this year's sales is between 5 million and 5.5 million units, a year-on-year growth of 23.5% based on the median. The focus this year is on iterating the pure electric platform and releasing the second generation of new blade Battery technology to improve charging speed and endurance.

In terms of vehicle recommendations, China Merchants International's industry top pick is Geely Automobile (00175), with Electric Vehicles expected to grow by about 70% to 1.5 million units this year, showing significant elasticity. The second favorite is BYD, which is still in a growth phase with a low valuation and a large potential domestic and international market space. Following that are the technology-leading Tesla (TSLA.US), Huawei系, Xiaopeng Motors-W (09868), and Li Auto-W (02015).

In terms of components, the bank's top choice is FUYAO GLASS (03606), bullish on the continuous increase in global market share and high growth capability. The transition from peak to off-season from January to February is a vacuum period for subsidy policies, which may cause fluctuations in Autos stocks. It's advisable to buy high-quality stocks with high certainty of growth at lower prices.