Daiwa Securities published a report stating that Xpeng (09868.HK) performed better than expected in the third quarter, but worse than market expectations, with a net loss of 1.808 billion yuan (the same below), the quarterly loss was less than expected. The areas that surpassed expectations were service revenue and gross margin.

Daiwa Securities has revised down Xpeng's estimated delivery volume for 2024 from 0.2 million units to 0.188 million units, while maintaining the estimated delivery volumes for 2025 and 2026 at 0.23 million units and 280,000 units respectively.

The firm has lowered its net loss forecasts for Xpeng from 2024 to 2026 by 14%/10%/19% to 6.679 billion/5.487 billion/4.229 billion respectively. Due to lackluster sales and intensified competition, it is expected that Xpeng will not turn a profit from 2024 to 2026. Maintain 'Sell'. The target price is raised from 25 yuan to 35 yuan.