Western Securities Co.,Ltd. issued a research report initiating coverage on CHERY AUTO (09973) with a "Buy" rating. The report highlights CHERY AUTO's significant first-mover advantage in overseas markets, projecting sustained growth in overseas sales and revenue as new energy vehicle exports accelerate and new markets continue to expand. Domestically, driven by new models such as the Fengyun and iCAR series, the company's new energy transition is expected to enter a fast track. The main viewpoints of Western Securities are as follows.
The five major brands each possess distinct highlights, with breakthroughs in the new energy transition and progress in premiumization. CHERY AUTO's portfolio currently encompasses five brand systems: CHERY, Jetour, Exeed, iCAR, and Zhijie. Each brand has a unique positioning, design language, and aesthetic appeal, covering various market segments with significant growth potential. Regarding new energy, the Fengyun series under the CHERY brand is set to be elevated to an independent brand by 2025, with plans to launch 16 new models over the next three years. The iCAR V27 is expected to launch globally in Q1 2026, aiding the iCAR brand in its goal to become the "world's leading distinctive new energy vehicle brand." In terms of premiumization, Jetour has launched its Zongheng series, entering the luxury off-road vehicle market and expanding internationally, which is anticipated to drive breakthroughs in both sales and profitability.
A commitment to independent R&D ensures comprehensive coverage of core technologies. Since its establishment, CHERY AUTO has persisted with independent research and development. Its current core technologies include Kunpeng Power, Falcon Smart Driving, Mars Architecture, and Lion Smart Cockpit. In April 2025, the company completed the first global delivery of 220 Mojia humanoid robots.
Overseas market potential is vast, and CHERY AUTO's first-mover advantage positions it for sustained export growth. With over twenty years of overseas presence, CHERY AUTO holds a significant first-mover advantage: 1) an extensive overseas dealer network, exceeding 1,000 dealers in 2025; and 2) production and R&D bases spread across the globe. In the first half of 2025, CHERY AUTO's overseas retail sales grew 20% year-over-year, with the proportion of new energy vehicles increasing notably. Bolstered by its first-mover advantage, and as new energy vehicle exports accelerate and new markets are explored, the company's overseas sales and revenue are expected to maintain rapid growth.
Risk factors include intensifying industry competition and the risk of the company's sales falling short of expectations; the risk that the growth rate of new energy vehicle penetration may not meet forecasts; risks associated with overseas market progress and profitability not meeting expectations; and risks related to overseas policies and trade barriers.
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