20221201-招银国际-Short-term_negatives_have_been_priced_in_4页_827kb

Xpeng Inc. (XPEV US) Summary

Core Content

Xpeng Inc. (XPEV US) has recently reported its 3Q22 earnings, which were largely in line with prior forecasts. Despite a slight miss in 4Q22 sales-volume guidance, the market reacted positively, suggesting that some investors may believe the worst is over for the company. The report highlights that Xpeng still has potential to turn around, supported by its RMB 35bn net cash position, which could sustain the company for 2-3 years.

Key Points

• Earnings Performance:

  • 3Q22 earnings (revenue, gross profit, net loss) matched expectations.
  • 4Q22 sales-volume guidance slightly missed the forecast.

• Financial Position:

  • Xpeng has a strong net cash position (RMB 35bn) that could support operations for 2-3 years.
  • The company has sufficient liquidity to weather potential challenges and support new product development.

• Outlook:

  • 4Q22E net loss is expected to narrow to RMB 1.7bn, aided by forex gains.
  • FY23E sales volume forecast was reduced to 180,000 units from 250,000 units due to the G9 miss.
  • FY23E net loss is projected to be RMB5.8bn, with ongoing cost reduction efforts.

• Valuation and Rating:

  • CMB International maintains a BUY rating.
  • Target price has been lowered from US$40.00 to US$20.00.
  • Valuation is based on 2.5x revised FY23E revenue estimates.
  • The lower target price reflects a weaker sales momentum compared to peers like Li Auto and NIO.

• Potential Catalysts:

  • The launch of three new models next year could be key turning points for the company.
  • Organizational and personnel changes may enhance focus and cost management.

• Autonomous Driving (AD) Technology:

  • Xpeng's leading AD technology in China could provide a competitive edge.
  • If all-scenario NGP is ready by 2024, it may significantly alter the industry landscape.

Key Risks

• Slower AD technology advancement.
• Faster catch-up from other automakers.
• Lower-than-expected sales volume or gross margin.
• Sector de-rating.

Financial Highlights

Key Ratios

Shareholding Structure

Stock Data

Share Performance

Analyst Certification

• The research analyst certifies that the views expressed accurately reflect personal opinions.
• No compensation is directly or indirectly related to the views expressed in the report.

CMBIGM Ratings

• BUY: Potential return of over 15% over next 12 months.
• HOLD: Potential return of +15% to -10% over next 12 months.
• SELL: Potential loss of over 10% over next 12 months.

Important Disclosures

• The report is not an offer or solicitation to buy or sell any security.
• CMBIGM is not a registered broker-dealer in the United States.
• The report is for distribution to "major US institutional investors" only.
• CMBIGM is not liable for any loss or damage arising from reliance on the report.
• The report is subject to change without notice.