Incident: According to Arklines, various models of the AITO Questionnaire brand were delivered in May, including 1190 M5 EVs, 4,542 M5 extended range; 10182 M7; 1,738 M9 EVs, and 14,725 M9 extended range models.
Comment:
New M5 and M7 orders are steadily climbing. According to Marklines data, AITO's various models were delivered in May as follows: 1190 M5 EVs, 4542 M5 Extended Range; 10182 M7 EVs; 1,738 M9 EVs; and 14,725 M9 EVs. Among them, Wenjie New M5 was launched on April 23 and large-scale delivery began on May 15. As of May 31, the cumulative total is estimated to have exceeded 20,000 units. On May 31, the new M7 Ultra was officially launched. Dading surpassed 12,000 units in 24 hours, and Dading surpassed 2,500 units during the Dragon Boat Festival (June 8 and June 9).
M9 delivery exceeded expectations and is expected to drive rapid improvement in the company's profits. Nationwide delivery of the Wenjie M9 began on February 26, and continued to climb in February-May. Delivery volumes were 5251, 5446, 15173, and 16463 units, respectively. Since April, it has become the most delivered car series by the Wenjie brand. We believe that with the rapid accumulation of orders for new M5 and M7 models and the further increase in delivery of the high-priced, high-margin M9 model, the company's profitability is expected to increase as the scale effect increases.
I am optimistic about the next iteration of ADS 3.0, further empowering intelligence. In April, Huawei released a new smart car solution brand “Qiankun” with intelligent driving as the core, bringing in newly upgraded solutions such as “Qiankun ADS”, “Qiankun Vehicle Control”, and “Qiankun Car Cloud”, and released new products such as ADS 3.0, 4D millimeter wave radar, iDVP2.0, XMOTION 2.0, and the Yunque Big Model. ADS3.0 upgraded the end-to-end large model. The architecture was upgraded from BEV to the GOD (General Obstacle Recognition) network to achieve deep understanding of driving scenarios; the PDP (Predictive Decision and Control) network was upgraded to achieve pre-decision-making and planning to achieve humanized decision-making and planning, and realized the NCA function of intelligent driving from parking space to parking space, and was no longer limited to ordinary roads. The Xiangjie S9, which was launched in August, will launch the Huawei ADS 3.0 advanced intelligent driving system. We are optimistic that subsequent Quanjie brand models will further enhance smart driving capabilities through OTA upgrades.
Profit forecast: New M5 and M7 orders are rapidly accumulating, and delivery of the high-priced, high-margin M9 model is further boosted. Looking ahead, Q2's net profit is expected to continue to increase, and we continue to be optimistic about opportunities to expand the Huawei industry chain. We expect the company to achieve revenue of 1437/1940/218.3 billion yuan in 2024-2026 and achieve net profit of 67/109/141 billion yuan to mother.
Risk factors: The risk of launching new models falling short of expectations, the risk of price wars, and increased competition for new energy high-end medium and large vehicles.