Investment Rating - The investment rating for the company is "Buy" (maintained) [2] Core Viewpoints - The company has launched the new B10 model, a compact SUV targeting the 100,000 to 150,000 RMB market, with a global launch planned for next year [2][5] - The B10 features the industry's only laser radar and 8650 chip for advanced intelligent driving solutions, enhancing both highway and urban navigation capabilities [2][5] - The latest LEAP3.5 technology architecture is utilized in the B10, improving the driving experience with integrated control systems and advanced thermal management [2][5] Financial Summary - The company is projected to achieve net profits of -3.703 billion, -1.086 billion, and 1.052 billion RMB for the years 2024, 2025, and 2026 respectively, with a PE ratio of 32.97 in 2026 [5][8] - Revenue is expected to grow significantly from 16.747 billion RMB in 2023 to 79.932 billion RMB in 2026, reflecting a growth rate of 295.41% in 2023 and 47.47% in 2026 [8][9] - The company's total assets are projected to increase from 28.453 billion RMB in 2023 to 61.780 billion RMB in 2026, indicating strong growth potential [8][9]

Investment Rating - The investment rating for the company is "Buy" (maintained) [1] Core Insights - The company has established significant self-research capabilities in both hardware and software, enhancing its product lineup and opening growth opportunities through international expansion [3][4] - The company has formed a joint venture with Stellantis to facilitate its global strategy, leveraging Stellantis' extensive distribution network [3][4] - Revenue is projected to grow significantly, with expectations of reaching 299.06 billion RMB in 2024, 542.03 billion RMB in 2025, and 799.32 billion RMB in 2026 [4][34] Summary by Sections 1. Self-Research and Product Development - The company, founded in 2015, has developed comprehensive self-research capabilities in core technologies for electric vehicles, including the production of key components and cloud-based solutions [3][8] - The product matrix includes five pure electric models and four extended-range models, with significant delivery growth from 1.7 thousand units in 2021 to 17.3 thousand units in the first nine months of 2024, reflecting a year-on-year increase of 94.6% [8][12] 2. Revenue Growth and Financial Performance - The company’s revenue has increased from 631 million RMB in 2020 to 16.75 billion RMB in 2023, with a 52.16% year-on-year growth in the first half of 2024 [12][13] - The net loss has narrowed from 5.11 billion RMB in 2020 to 2.21 billion RMB in the first half of 2024, indicating improving financial health [12][13] 3. Market Expansion and Sales Network - The company has rapidly expanded its sales network from 49 stores in 2019 to 560 stores by 2023, covering 182 cities [16][17] - The penetration rate of new energy vehicles in China is expected to reach 60.1% by 2026, indicating a favorable market environment for the company [18][19] 4. Strategic Partnerships and Globalization - The partnership with Stellantis involves a joint venture, with Stellantis holding 51% and the company holding 49%, aimed at expanding into international markets [11][30] - The company plans to establish 500 sales points in Europe by the end of 2025 and expand into Asia-Pacific, the Middle East, Africa, and South America starting in the fourth quarter of 2024 [31][32] 5. Financial Projections and Valuation - The company is expected to achieve vehicle sales of 250,000 units in 2024, 440,000 units in 2025, and 630,000 units in 2026, with a corresponding increase in average selling price [33][34] - The projected price-to-sales ratios for 2024, 2025, and 2026 are 1.17, 0.65, and 0.44 respectively, indicating a favorable valuation compared to peers [36][37]

Investment Rating - The investment rating for the company is "Buy" (maintained) [1] Core Views - The company achieved a record high in September sales, delivering 33,767 units, representing a year-on-year growth of 113.7%. The new models were officially launched in Europe [3] - The company is benefiting from new product launches and government policies promoting vehicle trade-ins, which have contributed to strong sales growth. The global expansion strategy is gaining momentum, with the debut of the B-series model, the Leap B10, at the Paris Auto Show [3] - The company has introduced an AI-powered voice model in collaboration with Alibaba Cloud, enhancing the smart cabin experience in its vehicles [3] - The forecast for the company's net profit attributable to shareholders for 2024-2026 is projected at -3.528 billion, -922 million, and 1.068 billion RMB, respectively, with a PE ratio of 36.72 times in 2026 [3] Financial Summary - The company reported a revenue of 16.747 billion RMB for 2023, with projections of 29.906 billion RMB for 2024, 54.203 billion RMB for 2025, and 79.932 billion RMB for 2026, indicating a revenue growth rate of 35.22% in 2023 and 78.58% in 2024 [6] - The net profit attributable to shareholders is expected to improve from -4.216 billion RMB in 2023 to 1.068 billion RMB in 2026, reflecting a significant turnaround [6] - The company's total assets are projected to grow from 28.453 billion RMB in 2023 to 62.581 billion RMB in 2026, with a corresponding increase in total liabilities [7]

Financial Performance - For the six months ended June 30, 2024, the company's revenue was RMB 8,845.4 million, an increase of 52.2% compared to RMB 5,813.1 million for the same period in 2023[5]. - The gross profit margin improved to 1.1% for the six months ended June 30, 2024, compared to a gross loss margin of (5.9%) in the same period of 2023, with Q2 2024 gross margin reaching 2.8%[6]. - The net loss attributable to equity holders for the six months ended June 30, 2024, was RMB 2,211.7 million, a slight improvement from RMB 2,276.1 million in the same period of 2023[6]. - Operating loss for the six months ended June 30, 2024, was RMB 2,395.0 million, a slight increase of 2.6% from RMB 2,333.6 million for the same period in 2023[15]. - The adjusted net loss for the six months ended June 30, 2024, was RMB 2,016.2 million, compared to RMB 1,936.5 million for the same period in 2023[16]. - Basic and diluted loss per share for the six months ended June 30, 2024, was RMB 1.65, down from RMB 1.99 for the same period in 2023[18]. - The company reported a total loss attributable to equity holders of RMB (2,211,736) thousand for the six months ended June 30, 2024, compared to RMB (2,276,109) thousand in the same period of 2023[98]. Vehicle Deliveries and Sales - The total vehicle deliveries for the six months ended June 30, 2024, reached 86,696 units, a 94.8% increase from 44,502 units in the same period of 2023[8]. - Sales of electric vehicles and components for the six months ended June 30, 2024, amounted to RMB 8,836.3 million, up 52.3% from RMB 5,803.2 million for the same period in 2023[15]. - The C10 model has delivered 24,106 units since its launch in March 2024, while the C16 model achieved over 10,000 orders in its first month, indicating strong market demand[8]. - The company has delivered over 400,000 new energy vehicles, showcasing its strong market position and customer trust[10]. Research and Development - R&D expenses for the first half of 2024 were RMB 1,221.3 million, an increase of 48.4% compared to the same period in 2023, reflecting increased investment in new vehicle development and smart driving technology[6]. - Research and development expenses increased to RMB 1,221,285 thousand, up from RMB 823,160 thousand in the prior year, reflecting a focus on innovation[72]. - The company is developing an end-to-end intelligent driving system, with plans to launch higher-level driving features in the second half of 2024, including point-to-point commuting capabilities[11]. - The company has established a "Smart Technology Research Institute" and plans to expand its team to approximately 500 people to enhance its intelligent driving algorithms and applications[11]. Cash Flow and Financial Position - The company achieved a net cash inflow from operating activities of RMB 267.6 million for the six months ended June 30, 2024, compared to RMB 151.7 million in the same period of 2023, with expectations for further improvement in the second half of the year[7]. - The company's free cash flow for the six months ended June 30, 2024, was RMB (482.3) million, a decrease of 7.5% from RMB (448.6) million for the same period in 2023[19]. - As of June 30, 2024, the company's cash and cash equivalents amounted to RMB 16,490.9 million, a decrease of 14.9% from RMB 19,388.1 million as of December 31, 2023[19]. - The company reported a total of 1,895,000 shares granted with a purchase price of RMB 2 per share during the reporting period[43]. Market Expansion and Strategy - The company plans to launch competitive vehicle models in the next two years, capitalizing on the 50% penetration rate of new energy vehicles in China during the first half of 2024[6]. - The company plans to expand into the European market with the launch of C10 and T03 in September 2024, aiming to inject new vitality into its long-term development[10]. - The company aims to achieve positive free cash flow in the second half of 2024, supported by sufficient cash reserves and improving self-financing capabilities[7]. - The company plans to expand its sales network in Europe to over 200 locations by the end of 2024 and to 500 locations by 2026[14]. Shareholder Structure and Incentives - The total issued domestic shares are 220,552,174, and the total issued H shares are 1,116,413,915[32]. - The company has implemented two share incentive plans and a pre-IPO share option plan to reward key employees[29]. - The shareholding structure indicates that Mr. Zhu and his spouse hold a combined 70% and 30% interest in Hangzhou Xintu, respectively[32]. - The company has a total of 50,594,348 stock options available under the pre-IPO stock option plan, representing approximately 3.78% of the issued share capital as of the report date[47]. Compliance and Governance - The company has adopted a standard code for securities trading by directors, ensuring compliance with relevant regulations[59]. - The company has implemented policies for handling and disclosing insider information, limiting access to relevant personnel only[59]. - The company has not separated the roles of Chairman and CEO, believing that this structure enhances internal leadership consistency[60]. - The company confirmed that all directors complied with the standard code during the reporting period[59]. Future Outlook - The company plans to raise up to RMB 600 million through share subscriptions for R&D investments, marketing, and general corporate purposes[26]. - The company is focusing on global expansion, particularly in the European market, as part of its long-term strategy to become a global electric vehicle manufacturer[55]. - The company plans to utilize the proceeds within three years from the completion date[54]. - The company aims to align employee interests with those of shareholders through the stock option plan, enhancing long-term development[47].

Investment Rating - The report maintains a "Buy" rating for Leapmotor (09863 HK) [3] Core Views - Leapmotor has significantly improved profitability and increased R&D investment in new models The company achieved positive gross margin for the first time in Q3 2023 at 1 2% and reached 6 7% in Q4 2023 [2] - The company has optimized its product matrix with a dual powertrain strategy (BEV+EREV) and plans to launch 7 new models by 2026 including B-series and D-series vehicles [2] - Leapmotor's global expansion strategy with Stellantis is expected to drive overseas growth with plans to enter European Middle Eastern and African markets starting September 2024 [2][4] Financial Performance - In H1 2024 Leapmotor achieved revenue of 8 845 billion yuan a 52% YoY increase with a net loss of 2 212 billion yuan mainly due to increased R&D expenses for new models and smart driving technology [2] - The company's gross margin improved to 1 13% in H1 2024 compared to negative margins in previous years [2] - Revenue is projected to grow significantly from 31 796 billion yuan in 2024 to 75 573 billion yuan in 2026 with gross margins expected to reach 13% by 2026 [4][7] Product Strategy - Leapmotor currently offers 5 models priced between 100 000-200 000 yuan with C-series models accounting for 72% of deliveries in H1 2024 [2][18] - The company plans to launch 3 B-series models priced at 100 000-150 000 yuan by 2025 and 3 D-series models around 200 000 yuan by 2026 [2][16] - Leapmotor's C16 model a 6-seat SUV priced under 200 000 yuan achieved over 10 000 orders in its first month of launch [59] Technology and R&D - Leapmotor has developed six core technology platforms including vehicle architecture electronic electrical architecture intelligent powertrain intelligent battery intelligent cockpit and intelligent driving [25] - The company's self-developed CTC 2 0 battery technology achieves a volume utilization rate of 79% and reduces weight by 15% compared to traditional designs [32] - Leapmotor's Leapmotor OS 3 0 intelligent cockpit system is powered by the Qualcomm Snapdragon 8295 chip offering 30TOPS of AI computing power [40] Overseas Expansion - Leapmotor International a joint venture with Stellantis plans to launch C10 and T03 models in 9 European countries starting September 2024 [60] - The company aims to establish 200 sales outlets by the end of 2024 and expand to 500 outlets by 2026 [61] - Overseas sales are projected to grow from 10 000 units in 2024 to 120 000 units in 2026 [7] Market Position - Leapmotor is positioned as a technology-driven new energy vehicle manufacturer with full-stack self-research capabilities [4] - The company's "China market + overseas market + Tier 1" strategy aims to expand from vehicle manufacturing to component supply leveraging its cost advantages and technological capabilities [8]

Investment Rating - The investment rating for the company is "Buy" (maintained) [1] Core Views - The launch of the C10 and T03 models in Europe marks a significant step in the company's international expansion strategy, supported by Stellantis [4] - The company plans to leverage Stellantis' distribution channels to increase its sales points to 350 by Q4 2024, with over 200 in Europe [4] - The C10 and T03 models are equipped with leading electric technology, offering high performance, efficiency, safety, and range [4] Financial Summary - The closing price as of September 25, 2024, is HKD 26.00, with a circulating share capital of 1.116 billion shares [2] - The projected revenue for 2024 is CNY 29.906 billion, with a growth rate of 78.58% [6] - The company expects to achieve a net profit of CNY 1.023 billion by 2026, with a corresponding PE ratio of 30.76 [5][6]

零跑汽车(09863) 公司研究/公司深度 深耕高性价比市场，合作 Stellantis 打开海外空间 ——首次覆盖报告 证 券 研 究 报 告 公 司 研 究 公 司 深 度 ◼ 核心观点 产品矩阵竞争力强，盈利能力不断改善 零跑汽车由朱江明、傅利泉先生于 2015 年发起创立，是一家具备全域 自研能力的智能电动车企业。目前零跑汽车共有 5 款车型在售，C 级 六座 SUV C16、B 级 SUV C11、B 级 SUV C10、C 级轿车 C01、微型 车 T03，主要集中在 10-20 万元之间的高性价比市场，单月销量已于 2024 年 6 月突破 2 万辆。 研发实力雄厚，掌握电子电气架构及智能化核心技术 2023 年，零跑汽车发布了四叶草中央集成式的电子电气架构，实现了 座舱域、智驾域、动力域、车身域四域合一。多系统软件深度融合， 实现更强交互及用户体验。零跑智能座舱 3.0 打造的全新交互系统 Leapmotor OS 拥有沉浸式交互、智能化桌面、操作更简单三大优势。 零跑智能驾驶 3.0 时代搭载 11 个摄像头、5 个毫米波雷达和 1 个激光 雷达，使用高精地图，实现 NAC 及 NAP 等高 ...

Investment Rating and Target Price - The report initiates coverage on Leapmotor (9863 HK) with a "Buy" rating and a target price of HKD 31.24, based on a 0.67x PS multiple for 2025, in line with peers like Li Auto, NIO, and XPeng [1][4] Core Investment Thesis - Leapmotor's core competitiveness lies in its in-house developed LEAP platform, which covers approximately 60% of vehicle costs through self-developed and self-manufactured core components [1][2] - The company is expanding its product matrix with both pure electric and range-extended models, targeting the mainstream 10-20 million RMB price segment [1][2] - Leapmotor's international expansion, accelerated by the strategic investment from Stellantis and the establishment of Leapmotor International, is expected to significantly enhance its growth potential [1][2] Financial Projections - Leapmotor's total vehicle sales are projected to grow from 266,000 units in 2024 to 694,000 units in 2026, representing year-over-year growth rates of 85%, 82%, and 43% respectively [1] - Revenue is expected to increase from RMB 31.9 billion in 2024 to RMB 79.5 billion in 2026, with year-over-year growth rates of 90%, 79%, and 39% respectively [1][3] Product Strategy and Market Positioning - Leapmotor focuses on the 10-20 million RMB mainstream market, with a product matrix that includes five mass-produced models: T03, C11, C01, C10, and C16 [2] - The company has introduced a dual powertrain strategy with both pure electric and range-extended models, enhancing its product offerings [2] - Leapmotor plans to launch multiple new models annually from 2025 to 2027 to maintain its cost advantage and expand its platform capabilities [2] Technological Advancements - The LEAP 3.0 platform features significant advancements in electronic architecture, battery CTC technology, and intelligent driving systems, contributing to cost reduction and improved performance [2] - The "Four-Leaf Clover" electronic architecture integrates four domains with two chips, achieving efficient coordination and cost savings [2] - Leapmotor's self-developed battery and electric drive systems have entered mass production, with some components already being supplied to external customers [2] International Expansion - Leapmotor International, a joint venture with Stellantis, adopts a light-asset model for overseas expansion, leveraging existing production and channel resources [2] - The company plans to start deliveries in Europe in Q3 2024 and expand to India, Asia-Pacific, the Middle East, Africa, and South America within the same year [2] - Leapmotor is also exploring technology licensing opportunities with Stellantis, potentially opening a new revenue stream through technology exports [2] Financial Performance and Profitability - Leapmotor's revenue grew by 35% year-over-year in 2023, reaching RMB 16.7 billion, with a narrowing net loss of RMB 4.2 billion [21] - The company achieved positive gross margin for the first time in 2023, with a full-year gross margin of 0.48%, and is expected to reach 8-10% when dealer rebates are included [22] - In H1 2024, Leapmotor's gross margin improved to 1.13%, with Q2 gross margin reaching 2.76%, driven by new model launches and increased sales [23] Market and Competitive Landscape - Leapmotor operates in the 10-20 million RMB price segment, where there is significant room for新能源 penetration, with a current新能源 penetration rate of 29.7% in this segment [28] - The company faces competition from other new energy vehicle manufacturers, but its focus on cost efficiency and technological innovation positions it well in the market [28] - Leapmotor's sales network has expanded to over 180 cities, with a mix of direct and authorized dealerships, supporting its market penetration efforts [38]

Investment Rating - The report maintains a "Buy" rating for Leap Motor (09863.HK) with a target price of HKD 30, corresponding to a market capitalization of HKD 406 billion and a P/S ratio of 1.3x for 2024 estimates [4][2]. Core Insights - Leap Motor's Q2 performance showed strong sales growth, with 53,286 vehicles sold, representing a 57% year-on-year increase. Revenue reached RMB 5.4 billion, up 23% year-on-year. The gross margin improved to 2.8%, marking a turnaround from losses, with a reduction in net loss margin to 22% [1][2]. - The company is set to expand its international sales, having established "Leap International" with Stellantis, and plans to begin sales in Europe in September, with expectations of selling around 6,000 vehicles overseas in Q4 [2][1]. - The report forecasts that Leap Motor will achieve over 250,000 vehicle deliveries in 2024, with total revenues projected to reach RMB 27.9 billion [2][3]. Financial Performance Summary - **Revenue Growth**: Leap Motor's revenue is expected to grow significantly from RMB 12.4 billion in 2022 to RMB 79.0 billion by 2026, with year-on-year growth rates of 295% in 2022, 35% in 2023, and 67% in 2024 [3][11]. - **Net Profit**: The company is projected to reduce its net losses from RMB 5.1 billion in 2022 to a profit of RMB 874 million by 2026, with net profit margins improving from -41.3% in 2022 to 1.1% in 2026 [3][11]. - **Gross Margin**: The gross margin is expected to improve from -15.4% in 2022 to 11% by 2026, indicating a positive trend in profitability as sales volume increases [8][11]. Sales and Production Outlook - Leap Motor's total vehicle sales are projected to increase from 111,168 units in 2022 to 740,918 units by 2026, with significant contributions from new models and international markets [11][12]. - The company aims to enhance its domestic sales network, expanding to 474 stores across 187 cities by mid-2023, with plans for further expansion to support sales growth [1][2].

Investment Rating - The report maintains a "Buy" rating for the company [1] Core Views - The company's Q2 2024 performance met expectations, with total revenue of 5.359 billion yuan, reflecting a quarter-on-quarter increase of 22.6% and a year-on-year increase of 53.7% [3] - The company reported a single-quarter loss of 1.199 billion yuan, which is a larger loss compared to previous quarters [3] - The average selling price (ASP) decreased to 101,000 yuan per vehicle due to a higher proportion of lower-priced models sold [3] - The gross margin for Q2 was 2.8%, aligning with company guidance, and is expected to improve in the coming months [3] - The company is focusing on both domestic market penetration and global expansion, with plans to establish over 200 sales outlets in Europe by the end of 2024 [4] Financial Summary - Total revenue projections for the company are as follows: 2023A: 16,747 million yuan, 2024E: 28,278 million yuan, 2025E: 60,467 million yuan, and 2026E: 83,838 million yuan, indicating significant growth [2] - The adjusted net profit forecasts have been revised down to -4.23 billion yuan for 2024, -1.13 billion yuan for 2025, and a positive 1.63 billion yuan for 2026 [4] - The company’s cash flow from operating activities is projected to be -5.784 billion yuan in 2024, indicating a challenging cash flow situation [9] Market Position and Strategy - The company is enhancing its focus on smart technology, having established a smart technology research institute and expanded its autonomous driving research team [4] - The company plans to showcase its first global model, the B10, at the Paris Auto Show in October 2024, which will utilize its latest technology architecture [4] - The company aims to maintain a gross margin target of 5% for the year despite current challenges [3]