Citigroup: Mainland raises subsidies for scrapping and updating automobiles, which may benefit BYD (01211.HK), Leapmotor (09863.HK), Chang'an (02333.HK), and Geely (00175.HK).

AASTOCKS · Jul 26 11:42

Citigroup reports that the Chinese government has increased subsidies for the auto trade-in policy launched in April, with the subsidy for new energy passenger vehicles raised from 0.01 million RMB to 0.02 million RMB. The subsidy for purchasing passenger cars powered by 2.0 liters and below of gasoline was increased to 0.015 million RMB.

Citigroup expects that the updated subsidies (valid until December 31) will benefit fourth-quarter performances of mainland automakers with early release of demand for 2025. Overall, the bank believes that this stimulus policy will be conducive to de-stocking of internal combustion engine vehicles and relatively faster penetration rate of plug-in hybrid and extended-range electric vehicles in the fourth quarter.

The bank believes that BYD Company Limited (01211.HK), Lixiang Auto Technology (09863.HK), China International Marine Containers (02333.HK), and Geely Automobile Holdings (00175.HK) have higher sales potential and richer product lines of plug-in hybrid and extended-range electric vehicles, and thus are expected to benefit the most from this updated subsidy.

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《大行》花旗：內地提高汽車報廢更新補貼 比亞迪(01211.HK)、零跑(09863.HK)、長汽(02333.HK)及吉利(00175.HK)可能最受惠

Citigroup: Mainland raises subsidies for scrapping and updating automobiles, which may benefit BYD (01211.HK), Leapmotor (09863.HK), Chang'an (02333.HK), and Geely (00175.HK).

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《大行》花旗：內地提高汽車報廢更新補貼比亞迪(01211.HK)、零跑(09863.HK)、長汽(02333.HK)及吉利(00175.HK)可能最受惠