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<Research>CMSI: CN Auto Mkt Expected to Bottom Out in 2H25; Top Picks GEELY AUTO/ LI AUTO/ XPENG
Recommend 45 Positive 84 Negative 32 |
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Car makers recorded generally stronger sales data for June, and it is expected that high-frequency data and market sentiment will bottom out in the second half of July, according to CMSI's research report. The Chinese government normalized the regulation of “involution” of auto companies, while GEELY AUTO (00175.HK)'s brand Galaxy, LEAPMOTOR (09863.HK) and XPENG-W (09868.HK) (XPEV.US) are expected to be the relative beneficiaries. CMSI' top pick is GEELY AUTO on its higher growth rate and lower valuation, followed by LI AUTO-W (02015.HK) (LI.US) and XPENG-W. From a market share and sales volume perspective, CMSI said that, strengthened involution regulation will have a negative impact on BYD COMPANY (01211.HK) (002594.SZ)'s ability to boost its domestic market share in the short term, but the company will make up for it by accelerating its overseas expansion. Other new forces favored include XIAOMI-W (01810.HK)'s Xiaomi Auto and Huawei Aito, driven by the launch of Xiaomi YU7 and sales of M8/M7. In terms of auto parts, the broker recommended FUYAO GLASS (03606.HK) and MINTH GROUP (00425.HK), as the former has high industry barriers and strong pricing ability, while the latter entered the new humanoid robotic segment to promote valuation recovery. In terms of the smart driving supply chain, CMSI recommended HORIZONROBOT-W (09660.HK) and Hesai Group (HSAI.US), which are the leading domestic smart driving SoC chip provider and the world's leading and first profitable lidar company respectively. In terms of robotics OEMs, CMSI recommended UBTECH ROBOTICS (09880.HK), the leader in China's humanoid robot industry with the largest factory training in the world, and DOBOT (02432.HK), the leader in China's collaborative robots, with the world's second-largest shipment volume and the first in China. The table below shows ratings and target prices for Chinese automakers from CMSI: Stock| Rating| TP (HKD) GEELY AUTO (00175.HK)|Buy| 27.5 BYD COMPANY (01211.HK)|Buy|170 XPENG-W (09868.HK)|Buy|115 ZHONGSHENG HLDG (00881.HK)|Buy|24 FUYAO GLASS (03606.HK)|Buy|73 LI AUTO-W (02015.HK) |Buy|138 GWMOTOR (02333.HK) |Buy|19 MINTH GROUP (00425.HK) |Buy|34 AASTOCKS Financial News Website: www.aastocks.com |
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