20180607-交银国际证券-吉利汽车-00175.HK-May_sales_volume_jumped_61__YoY_3页_469kb

Geely Automobile Summary (July 7, 2018)

Core Content

Geely Automobile, listed on the Hong Kong Stock Exchange (175 HK), reported its May sales volume results, showing a significant year-over-year growth and a slight month-over-month decline. The report also highlights the launch of new electric vehicle (NEV) models and provides an investment rating and related disclosures.

Key Sales Performance

• May Sales Volume:
  • Increased by 61% YoY to 123,068 units.
  • Decreased by 4% MoM from April, which is in line with seasonal expectations.
• Year-to-Date (YTD) Sales Volume:
  • Rose by 44% YoY to 638,181 units.
  • Accounts for 40% of the full-year target of 1.58 million units.
• Top Performing Models:
  • Boyue, Emgrand GS/GL, and Vision SUV continued to show strong sales performance in May.
  • Lynk & Co 01 sales remained relatively stable at 9,234 units.

New Model Launches

• Borui GE was officially launched in May with a price range of RMB136.7k-199.8k.
  • Features eight different models with PHEV and MHEV versions.
  • Represents a major step in Geely's NEV development strategy.
• Lynk & Co 02 is expected to be available for sale in June.
  • Anticipated to contribute to future sales growth.

Investment Rating

• Rating: Buy
• Target Price (TP): HK$35.00
• Rationale:
  • The success of new models like Lynk & Co and Borui GE is expected to drive sales and re-rate the stock.
  • Key risks include lower-than-expected sales growth of new models and intensified competition in the SUV market, which could affect earnings.

Analyst Information

• Analyst: Angus Chan
• Contact: angus.chan@bocomgroup.com, (86) 21 6065 3601
• Company: BOCOM International
• Address: 10/F, Man Yee Building, 68 Des Voeux Road Central, Central, Hong Kong
• Phone: (852) 3766 1899
• Fax: (852) 2107 4662

Rating System

• Buy: Expected total return to exceed the industry benchmark.
• Neutral: Expected total return to align with the industry benchmark.
• Sell: Expected total return to be below the industry benchmark.
• Not-Rated: No clear conviction about the stock's performance relative to the industry.

Industry Views

• Outperform: Analyst expects the industry to outperform the broad market.
• Market Perform: Analyst expects the industry to perform in line with the broad market.
• Underperform: Analyst expects the industry to underperform the broad market.

Broad Market Benchmark

• Hong Kong: Hang Seng Composite Index
• China A-shares: MSCI China A Index
• US-listed Chinese companies: S&P US Listed China 50 (USD) Index

Analyst Certification

• All views in the report reflect personal opinions of the authors.
• No part of their compensation is directly related to the recommendations.
• No insider information was used in the report.

Disclosure of Business Relationships

• BOCOM International has business relationships with several companies, including:
  • Bank of Communications, Guolian Securities Co. Ltd., Orient Securities Company Limited, Everbright Securities Company Limited, Guotai Junan Securities Co. Ltd, and others.
• Certain subsidiaries of BOCOM International hold more than 1% equity in companies like Orient Securities, Everbright Securities, Guolian Securities, and Guotai Junan Securities.

Disclaimer

• The report is strictly confidential and for private circulation only.
• It is not an offer or recommendation to buy or sell securities.
• The information is based on data believed to be correct and reliable at the time of issue.
• BOCOM International Securities Ltd and its affiliates may have conflicts of interest due to business relationships or ownership stakes.
• The views and recommendations may change without notice, and the company does not guarantee updates or accuracy of the information.