DFZQ has issued a research report forecasting that GEELY AUTO (00175) will achieve attributable net profits of RMB 20.476 billion, RMB 25.942 billion, and RMB 30.809 billion for the years 2026, 2027, and 2028, respectively. Maintaining an average comparable company valuation of 11 times the 2026 price-to-earnings ratio, the target price is set at RMB 20.79, equivalent to HKD 23.79 (using an exchange rate of 1 HKD = 0.8739 RMB). The "Buy" rating is reaffirmed.
The key points from DFZQ's report are as follows:
**April Sales Growth Expected to Outpace Industry Average** GEELY AUTO's total sales in April reached 235,200 units, representing a year-on-year increase of 0.4% and a month-on-month increase of 0.9%. Cumulative sales for the January-April period totaled 944,500 units, a year-on-year rise of 0.7%. According to data from the Passenger Car Association, national passenger vehicle wholesale sales from April 1st to 26th were 1.268 million units, reflecting a year-on-year decline of 15% and a month-on-month decrease of 24%. Cumulative wholesale sales for the period reached 7.134 million units, down 8% year-on-year. It is anticipated that the company's year-on-year and month-on-month sales growth rates will surpass the market average.
**Accelerated Overseas Expansion Drives Sustained Sales Growth** Sales of the Geely brand in April were 180,600 units, a month-on-month increase of 1.3%. Sales of Geely's new energy vehicles reached 135,600 units, up 8.0% year-on-year and 6.5% month-on-month, accounting for 57.7% of total sales. Within this, Galaxy series sales were 91,000 units, a month-on-month increase of 10.0%. The Galaxy Starlight 7 began pre-sales on April 16th, demonstrating competitiveness in areas such as four-wheel-drive motors, chassis, and exterior design, while also filling the market gap between the Starlight 6 and Starlight 8 models. The new Galaxy A7 EM and A7 EV all-electric models launched on April 22nd, followed by the Galaxy M7 Voyager on April 28th. Overall, the pricing of the new Galaxy A7 and M7 models is considered highly competitive. It is expected that sales performance will improve as the Galaxy product matrix is further refined.
Regarding overseas operations, Geely's exports in April totaled 83,200 units, surging 244.7% year-on-year and increasing 1.9% month-on-month. Cumulative exports for January-April reached 286,200 units, a substantial year-on-year growth of 150.9%. The company is accelerating its international expansion. On April 21st, Geely held an International Business Partner Conference attended by over 1,000 dealer representatives from more than 100 countries. The company plans to focus on developing four major markets with sales targets exceeding 150,000 units each in Europe, Eastern Europe, ASEAN, and Latin America/Africa, alongside a 100,000-unit target market in Central Asia and the Asia-Pacific. The annual export target is set at 750,000 units. Overseas expansion is projected to become a core growth engine for the company by 2026.
**Zeekr Sales Reach New Highs, Highlighting Premiumization Success** Zeekr brand sales in April were 31,800 units, soaring 131.6% year-on-year and rising 8.4% month-on-month. Cumulative sales for January-April reached 108,800 units, a year-on-year increase of 97.4%. Lynk & Co brand sales in April were 22,800 units, with cumulative January-April sales of 104,400 units, up 4.2% year-on-year.
The premiumization strategy for the Zeekr brand is progressing well, with April deliveries setting a new record. The average selling price per vehicle has approached RMB 350,000. Specifically, the average transaction price for the Zeekr 9X model is approximately RMB 530,000, capturing about one-third of the market share for models priced above RMB 500,000. The Zeekr 8X launched on April 17th, receiving over 10,000 firm orders within 29 minutes and delivering 3,500 units within 13 days. Ultra and higher-tier configurations accounted for 95.6% of these orders. The report views this order structure as indicative of strong consumer acceptance of the company's premium product lineup. The subsequent overseas launch of models like the Zeekr 9X and 8X is expected to help establish a premium brand image and enhance profit flexibility.
**Risk Factors** Potential risks include brand sales falling below expectations and cost control measures not meeting targets.
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