To The Moon

$GEELY AUTO(00175)$ 

Geely - the hidden gem in the automotive sector 

Geely has it's fingers in multiple bets, probably the Volkswagen of the East with it's stable of in-house brands Zeekr and Polestar, it also has stakes in Volvo , Mercedes-Benz and Lotus. Geely also owns a 50:50 stake in Malaysian national carmaker Proton. 

With the acceleration of Geely's global expansion and the enhancement of its international influence, the company has achieved high-quality market share in multiple countries. Geely Auto has ranked among the top three in terms of Chinese brand vehicle sales in 14 countries, including Saudi Arabia, the UAE, Qatar, and the Philippines. Presently, 1 in 4 cars are from exports. 

Unlike it's homegrown competitors thr likes of $BYD COMPANY(01211)$ ,  $NIO-SW(09866)$ , $XPENG-W(09868)$  and $LI AUTO-W(02015)$  whose main market is the huge domestic Chinese EV market, it's diversified brands offer exposure to the growth of FSD, EVs exponential growth without an overly domestic focus. 

It's stable of brands allow cross sharing of platforms and battery technology, while keeping the brand appeal of the premium brands. The global automotive market has it's share of customers loyal to a specific brand and it's not just about cars or technology. Volvo, the Swedish brand now owned by Geely motto - Volvo for life, is proof that brands don't die, companies do, just like Nokia or Kodak, both long gone but now back in different guise. It's competition is now creating sub brands to cater to the different customer segments while Geely is already way ahead. 

Of course, such a diversified approach brings many risks as it's brands compete with each other for customers. But it alsoeams that when you walk rhe street shopping for your car, whichever brand you choose could be made by a Geely owned company. 

It's  enterprise value can only grow as it's stwble of companies are listed. Volvo, Zeekr and Polestar are already listed and its subsidiary, Lotus Technology waa listed this week on Nasdaq at a valuation of $5.5 billion. 

Geely Automobile Holdings has a market cap or net worth of EUR 18.21 billion. The enterprise value is 15.02 billion. The next estimated earnings date is Friday, March 21, 2025. The trailing PE ratio is 9.27. The company has a current ratio of 1.07, with a Debt / Equity ratio of 0.09.

Current Ratio: 1.07

Enterprise Value: 15.02B

Market Cap: 18.21B

Quick Ratio: 0.85

Geely will report it's earnings on 21st March 2025. It's share price has run up from HKD16 to HKD18.60 as of this article. 

Is Geely a good buy now? Analysts have a price target of HKD19 to HKD24. I believe HKD24 is still a very reasonable valuation for such a  diversified automotive business.