20260427-招银国际-长城汽车-601633.SH-New-model_sales_as_key_after_1Q26_solid_GPM_5页_1mb

Great Wall Motor (2333 HK/601633 CH) Summary

Core Content

Great Wall Motor has demonstrated strong performance in its first quarter of 2026 (1Q26), with its gross profit margin (GPM) exceeding expectations despite industry challenges. This performance has led to a more positive outlook for the company's full-year margins in FY26-27. The company is expected to launch a significant number of new models in FY26, which could further boost its sales and profitability. Analysts maintain a "BUY" rating for both the H-share (2333 HK) and A-share (601633 CH), with target prices of HK$19.00 and RMB28.50, respectively.

Main Points

• 1Q26 Performance:

  • Revenue increased by 13% YoY, driven by a 5% sales volume growth.
  • GPM widened to 18.5%, surpassing the forecast by 0.7ppts.
  • Net profit reached RMB945mn, aligning with forecasts excluding Russia's recycling fee reimbursement.
  • SG&A and R&D expenses were in line with projections.

• Future Outlook:

  • GPM Projections:
    • FY26E: 18.1% (up 0.1ppts YoY), supported by rising exports and the new Guiyuan platform.
    • FY27E: 17.9%, with cost reduction effects from new models becoming more apparent.
  • Sales Volume Projections:
    • FY26E: 1.45mn units, driven by Wey.
    • FY27E: Expected to rise to 1.6mn units, with Wey and Ora leading the growth.

• Valuation and Target Price:

  • FY26E net profit forecast reduced by 13% to RMB10.2bn due to slightly lower sales and higher selling expenses.
  • FY27E net profit forecast increased by 4% to RMB11.8bn.
  • H-share target price: HK$19.00 (based on 12x FY27E P/E).
  • A-share target price: RMB28.50 (based on an average A/H premium of 70%).

Key Financial Metrics

Key Risks

• Lower-than-expected sales volume or margins.
• Sector de-rating.
• Potential changes in market conditions or economic factors affecting the automotive industry.

Analysts

• Ji SHI, CFA: (852)37618728 | shiji@cmbi.com.hk
• Wenjing DOU, CFA: (852)69394751 | douwenjing@cmbi.com.hk
• Austin Liang: (852)39000856 | austinliang@cmbi.com.hk

CMBIGM Ratings

• BUY: Stock with potential return of over 15% over next 12 months.
• HOLD: Stock with potential return of +15% to -10% over next 12 months.
• SELL: Stock with potential loss of over 10% over next 12 months.
• NOT RATED: Stock not rated by CMBIGM.
• OUTPERFORM: Industry expected to outperform the relevant broad market benchmark.
• MARKET-PERFORM: Industry expected to perform in-line with the relevant broad market benchmark.
• UNDERPERFORM: Industry expected to underperform the relevant broad market benchmark.

Analyst Certification

• The research analyst certifies that the views expressed reflect their personal views and that their compensation is not directly or indirectly related to the report's content.
• The analyst confirms that they and their associates have not traded in the stocks covered within 30 days before the report's issue and will not trade within 3 business days after the issue.
• The analyst does not serve as an officer of any Hong Kong listed company covered and has no financial interests in them.

CMB International Global Markets Limited

• A subsidiary of CMB International Capital Corporation Limited.
• Address: 45/F, Champion Tower, 3 Garden Road, Hong Kong.
• Tel: (852) 3900 0888 | Fax: (852) 3900 0800

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Additional Information

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