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<Research>JPM Adjusts TPs for LEAPMOTOR/ XPENG to $90/ $100
Recommend 45 Positive 64 Negative 28 |
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The 1H25 results of Chinese autos are expected to show a divergent pattern, JPMorgan said. Despite the sector's overall increase of 9% YTD, individual stock performance diverged, significantly affected by factors like new models, sales, profits and policies. LEAPMOTOR (09863.HK) is expected to be a highlight, with a 53% QoQ increase in 2Q25 sales and stable gross profit margin. Therefore, the broker raised its target price from $82 to $90. Despite a slight decline in vehicle gross profit margin on promotional activities in 2Q25, LI AUTO-W (02015.HK) focused on the upcoming launch of 2 new pure electric models, naming the i8 premium SUV to be launched on 29 July and the i6 mid-sized SUV to be launched in September. These are expected to boost sales and profitability from 3Q25, with its differentiated positioning targeting family users and the high-end market providing an advantage in the current fiercely competitive low-end segment. Therefore, JPMorgan rated LI AUTO-W at Overweight, with a target price of $135. GWMOTOR (02333.HK) is expected to see a 90% QoQ increase in 2Q25 profit due to sales growth and deferred tax rebate from Russia, although profit still slipped 15% YoY. XPENG-W (09868.HK) is expected to see a slight improvement in vehicle gross profit margin for the quarter, with market focus on whether SUV models like the G7 can double sales, and the market performance of the new P7 sedan to be launched in August and the first extended-range model to be launched in 4Q25. The broker rated XPENG-W at Overweight, and trimmed its target price from $122 to $100. For joint venture brands, JPMorgan upgraded SAIC MOTOR (600104.SH) from Underweight to Neutral due to its stable profit and plans for Volkswagen to launch 18 new models through the joint venture from 2026 to 2027, and lifted its target price from RMB11 to RMB15. GAC GROUP (02238.HK) may issue a profit warning for 1H25. JPMorgan lowered its profit forecasts for both BYD COMPANY (01211.HK) and GEELY AUTO (00175.HK) by about 10%. The former's overseas expansion beat expectations, but domestic business dragged down overall profits, while the latter, despite strong sales, faced profitability pressures. Therefore, the broker rated BYD COMPANY at Overweight, with a target price of $180. AASTOCKS Financial News Website: www.aastocks.com |
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