Guangzhou Automobile May See Weaker Net Profit Amid Competition -- Market Talk

Dow Jones04-11

0635 GMT - Guangzhou Automobile Group may see lower-than-expected net profit in 2024, dragged by continuous joint venture market share loss and a sustained price war among Chinese electric vehicle makers, Citi analysts write in a note. Citi lowers its net profit forecast for the company for 2024-2025 by 4%-6% as it sees rising competition among local brands leading to a lower gross profit margin. While the management has said it doesn't have production reduction plans for its joint venture brands such as Honda, Toyota and Trumpchi, Citi notes that the joint venture brands have seen their market share decline lately. The bank keeps a buy rating for the H shares and lowers target price to HK$4.57 from HK$4.75. Shares last at HK$3.35. (jiahui.huang@wsj.com; @ivy_jiahuihuang)

(END) Dow Jones Newswires

April 11, 2024 02:35 ET (06:35 GMT)

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