Q3 delivery conforms to the guidelines, and Q4 delivery guidelines are 4.3-48000 units. The company delivered 31600 vehicles in 2022 Q3, with revenue of 13 billion yuan, an increase of 33% over the same period last year, in line with the guidelines. Q3 non-GAAP belongs to ordinary shareholders with a net loss of 3.46 billion yuan, with a net loss rate of 26.6%, an increase of 5.4pct over Q2, mainly due to increased investment in research and development and a month-on-month decline in gross profit margin. The company's 2022Q4 guidelines are sales of 4.3-48000 units and revenue of 173.68-19.225 billion yuan, an increase of 75.4% and 94.2%.
2023H1 is expected to release five new models, delivering strong growth momentum. Existing model delivery: the company is still relatively abundant in-hand orders, according to store research, the current ET5 pick-up time is about 2023Q1, ET7/ES7 pick-up time is about 2023 before the Spring Festival, the follow-up delivery mainly depends on the pace of crawling. The company's December delivery target sprint 20,000: 1) ET5 is currently limited by the new EDS electric drive capacity climbing, delivery slightly lower than expected, this month EDS will add a production line, it is expected that December ET5 capacity restrictions will be resolved; 2) ET7/ES7 before the subframe supply problem has been basically solved, follow-up delivery will continue to improve, at the same time, the company plans to strengthen terminal publicity, thicken orders on hand. Follow-up new models: the company plans to launch five new models of the NIO brand in the first half of 2023, which we expect to include three modifications based on the NT 2.0 platform and two new models. It is estimated that by June 2023, the total number of models sold by the company will reach 8.
With the production of ET5/ES7/ET7, the rapid convergence of new models and the development of overseas markets, we expect the company's sales to reach 240000 units in 2023, a doubling of growth. In addition, the company's second brand positioning below 300000 of the mass market, industry and research steadily advancing, is expected to contribute to long-term sales growth.
Vehicle gross profit margin is under short-term pressure and the long-term upward trend remains unchanged. The company's 2022Q3 gross profit margin was 13.3%, an increase in 0.3pct compared with the previous month, in which the gross profit margin of vehicle sales decreased by 0.3pct to 16.4% from the previous month, mainly due to the increase in the price of raw materials and the lower gross profit margin at the initial stage of new models; services and other gross profit margins were repaired to-21% compared with the previous month. Q4 expects that the company's vehicle gross margin will still face some pressure, mainly due to higher raw material prices and higher delivery share of ET5 models with low gross margins. In the long run, if the cost of upstream raw materials remains stable, the overall gross profit margin is expected to continue to rise as the old models move to the new platform and the server gross margin is repaired.
The increase in the scale of sales drives down the rate of expenses, and the company is expected to move steadily towards profitability. The company's Q3 R & D expenditure rate is 23%, and the net R & D cost is 2.95 billion yuan. the follow-up company plans to control the quarterly net R & D investment at about 3 billion yuan. it is expected that the R & D expenditure rate will be controlled in low double digits in 2023. The company's Q3 sales expense rate is 21%, which is lower than that of Q2 by 1.3pct. It is expected that the company's new stores and power stations will expand steadily. With the increase of sales scale, the sales expense rate still has room to decline. Combined with the increase in gross profit margin and the decrease in expense rate brought about by economies of scale, we expect the company's non-GAAP net profit margin to become regular in a single quarter in 2024, and the company aims to achieve regular NIO brand profit by the end of 2023.
Investment suggestion: we estimate that the company will sell about 12.7 picks 242 picks in 2022-2025, total revenue will reach RMB 156.5 billion, and non-GAAP net profit margin will be about-20%, 8%, 1%, 2%. Combined with the interbank valuation, we give it a target market capitalization of about US $28.3 billion (HK $221.7 billion), corresponding to about 4X 2022e Pamp S, which is about HK $138.0 for Hong Kong stocks (9866.HK) and US $17.60 for US stocks (NIO.N), maintaining a "buy" rating.
Risk tips: car development and sales are not as expected risk, new brand promotion is not as expected risk, upstream parts supply fluctuation risk.