Company and Industry Summary Company Overview - The company discussed is a domestic automotive manufacturer, referred to as "领跑" (Lingpao), which is experiencing significant changes in sales volume and profitability trends [1][2][3]. Key Points and Arguments Sales Volume and Growth - The company has seen a substantial increase in sales volume, with monthly sales rising from approximately 20,000 units to 50,000 units over the past year, indicating a strong growth trajectory [1]. - Projections for 2025 suggest that most new energy vehicle brands will achieve profitability, with monthly sales in the range of 25,000 to 45,000 units being sufficient to reach breakeven [2]. Profit Margins and Financial Performance - The company reported a revenue target of over 30.5 billion RMB for the year, with an average gross margin exceeding 8%. The gross margin for Q4 was noted to be above 13% [5]. - Despite a decline in per vehicle revenue, the overall gross margin is expected to improve due to a recovery in discounts and a stable product mix [6][7]. - The gross margin for 2025 is projected to be around 15%, driven by new product launches and platform upgrades [10]. Market Dynamics and Competitive Landscape - The company is engaged in a price war to capture market share, with expectations of significant market share growth for strong brands in the range of 8% to 14% [4]. - The competitive landscape is anticipated to shift in 2026, with increased competition from domestic brands, suggesting that 2025 may be a pivotal year for market positioning [4]. Product Development and Innovation - The company is transitioning to a more integrated platform (Leap 3.5), which is expected to reduce costs and improve gross margins due to higher integration levels [10]. - New models, particularly the C16 and B series, are expected to contribute significantly to sales growth, with a projected increase in domestic sales volume of at least 45,000 units for 2025 [9]. International Expansion and Future Outlook - The company has not yet fully reflected its overseas potential in its current valuation, with expectations for improved international sales data to emerge in April [12][13]. - The acceptance of the company's vehicles in international markets appears promising, particularly for smaller models suited to narrower road conditions [13]. Additional Important Insights - The company is expected to maintain a price-to-sales (P/S) valuation approach in the short term, as it stabilizes its profitability before transitioning to a price-to-earnings (P/E) valuation [8][11]. - The overall industry outlook remains cautiously optimistic, with a strong emphasis on the company's ability to adapt to market changes and leverage new product offerings for sustained growth [12].

Investment Rating - The investment rating for Leap Motor (09863.HK) is not explicitly stated in the provided documents, but the report indicates a positive outlook based on expected financial performance and growth prospects [2][3]. Core Insights - Leap Motor anticipates a significant increase in revenue, projecting at least 30.5 billion RMB for 2024, representing a year-on-year growth of over 80% [2][3]. - The company expects a gross margin of no less than 8% for 2024, with a notable improvement in Q4 2024 gross margin projected to be at least 13% [2][3]. - Leap Motor achieved positive net profit in Q4 2024, ahead of its target by one year, driven by strong sales and effective cost management [2][3]. - The B series, based on the Leap 3.5 architecture, is expected to contribute significantly to new growth, with the first model, the Leap B10, set to launch in Q1 2025 [3]. - The company is expanding its presence in overseas markets, having established over 400 sales outlets in 13 European countries, with plans to reach 500 by the end of 2025 [3]. Financial Summary - For 2024, Leap Motor forecasts revenue of 30,500 million RMB, with a year-on-year growth rate of 82% [4]. - The projected net profit for 2024 is -2,851 million RMB, improving to 461 million RMB in 2025 and 2,407 million RMB in 2026 [4]. - The earnings per share (EPS) is expected to improve from -3.62 RMB in 2023 to 1.80 RMB by 2026 [4]. - The company’s total assets are projected to grow from 28,453 million RMB in 2023 to 53,489 million RMB in 2026 [5]. Key Financial Ratios - The gross margin is expected to rise from 0.48% in 2023 to 14.00% by 2026 [6]. - The price-to-earnings (P/E) ratio is projected to shift from -9.27 in 2023 to 17.70 in 2026, indicating a potential recovery in profitability [6].

Investment Rating - The investment rating for the company is "Buy" and is maintained [5]. Core Insights - In December, the company achieved a record monthly delivery of 42,517 vehicles, representing a year-on-year growth of 128.4% and a month-on-month increase of 5.8% [3][6]. - For the entire year, the company delivered over 294,000 vehicles, exceeding its annual target of 250,000 by 17% and showing a year-on-year growth of 103.8% [6][7]. - The company is expected to continue its strong sales growth due to a robust new car cycle domestically and a partnership with Stellantis for overseas expansion, which opens up global sales opportunities [6][7]. Summary by Sections Sales Performance - December deliveries reached 42,517 units, marking a 128.4% increase year-on-year and a 5.8% increase month-on-month [3][6]. - Cumulative sales for the year totaled 294,000 units, surpassing the target by 17% [6][7]. Future Outlook - The company aims for a sales target of 500,000 units in 2025, indicating a continued high growth trajectory [6][7]. - The introduction of new models and expansion into international markets are key strategies for future growth [6][7]. Product and Market Strategy - The company plans to launch 2-3 new products globally each year over the next three years, with a focus on the B series models priced between 100,000 to 150,000 yuan [6][7]. - The domestic market strategy includes a "1+N" channel development model, with a significant number of sales and service outlets established [6][7].

Investment Rating - The report does not explicitly state an investment rating for the company Core Insights - The company is positioned as a technology-driven smart electric vehicle manufacturer with comprehensive self-research and manufacturing capabilities, covering vehicle design, R&D, manufacturing, intelligent driving, and battery systems [9] - The company is accelerating its globalization efforts, with plans to launch new models in Europe, including the B10, C10, and T03, which are expected to enhance its market presence [10][28] - The company has established a strategic partnership with Stellantis to leverage its global market resources and enhance competitiveness in overseas markets [55][62] Summary by Sections Section 1: Market Contribution - The overseas market, particularly Europe, is expected to contribute significantly to the company's growth, with a focus on meeting the 2025 carbon emission standards [5][35] - The T03 model has shown strong sales growth due to government policies promoting vehicle trade-in programs, achieving a year-on-year increase of 120% in sales [24] Section 2: Financial Performance and Forecast - In 2023, the company delivered 144,000 electric vehicles, a year-on-year increase of 29.7%, with the C series models accounting for over 73.3% of total deliveries [15] - The company anticipates a significant increase in deliveries in 2024, with a projected total of 87,000 vehicles, reflecting a year-on-year growth of 94.8% [15] Section 3: Product Development and Strategy - The company is developing seven new models, with a focus on enhancing product offerings and market competitiveness [10][53] - The C10 model is positioned to fill a gap in Stellantis's B-segment SUV lineup, expected to perform well in the European market due to its competitive pricing and features [59] Section 4: Strategic Partnerships - The partnership with Stellantis includes joint development and tuning of vehicle chassis to improve global competitiveness [30] - The establishment of a joint venture with Stellantis aims to facilitate the company's entry into international markets, with a focus on leveraging Stellantis's distribution network [55][62]

Group 1 - A new company named Leap International Trade (Jinhua) Co., Ltd. has been established with a registered capital of 1 million RMB, focusing on battery sales, automobile sales, new energy vehicle sales, and smart power distribution and control equipment sales [1] - Leap International Trade is wholly owned by Leap Motor (09863.HK) [2]

Investment Rating - The report assigns an "Outperform the Market" rating to the company, with a target market value range of 449-505 billion yuan, corresponding to a stock price of 35.92-40.41 HKD [2][360][369]. Core Insights - The company is experiencing rapid growth in domestic sales, with a significant increase in new model launches and an expansion of its sales channels, particularly through collaboration with Stellantis for international market entry [2][21][88]. - The company has achieved a turnaround in gross profit, with a gross margin of 8.10% in Q3 2024, indicating a positive trend in profitability as sales volumes increase [2][39][342]. - The company is set to launch new models (C10/C16) in 2024, which are expected to drive sales growth, with a cumulative sales increase of 100% year-on-year from January to November 2024 [2][53][54]. Financial Projections - Revenue projections for 2024, 2025, and 2026 are estimated at 314.13 billion, 561.00 billion, and 814.00 billion yuan, respectively, with net profits expected to shift from losses of -37.21 billion and -5.78 billion in 2024 and 2025 to a profit of 23.72 billion in 2026 [3][342][351]. - The company anticipates a significant increase in sales volume, with domestic retail expected to reach 287,561 units in 2024 and 419,000 units in 2025 [342][345]. Market Dynamics - The global automotive market is segmented into five major regions, with the EU expected to become a significant growth area for Chinese automotive brands due to favorable tariff conditions and a growing preference for low-energy vehicles [2][100][129]. - The EU market for passenger vehicles is approximately 10 million units, with a notable shift towards small, low-energy vehicles, creating opportunities for Chinese brands to penetrate this market [2][105][129]. Competitive Advantages - The company leverages its strong product capabilities, full-stack self-research in electronic and electrical architecture, and international partnerships to enhance its competitive position [2][21][81]. - The "Four-Leaf Clover" architecture, which integrates multiple functionalities into a single system, supports the company's strategy of low-cost, high-intelligence vehicle production [2][82][86]. International Expansion - The establishment of "Leap International" in partnership with Stellantis marks a strategic move to expand into international markets, with plans to open over 500 sales points globally by the end of 2025 [2][88][330]. - The company has already opened 339 stores in 13 European countries, indicating a strong start to its international sales strategy [2][330][331].

%% %% 丨证券研究报告丨 港股研究丨公司点评丨零跑汽车（9863.HK） [Table_Title] 零跑汽车 11 月销量点评：月交付突破 4 万辆持 续创新高，提前完成全年 25 万辆交付目标 | --- | --- | --- | |---------------------------------------------------------------------------------------------------------------------|-------|-------| | | | | | 报告要点 | | | | [Table_Summary] 零跑汽车 11 月交付突破 4 万辆创历史新高，同比增长 117.0% ，环比增长 5.2% 。展望未来， | | | 分析师及联系人 [Table_Author] 高伊楠 王子豪 SAC：S0490517060001 SAC：S0490524070004 SFC：BUW101 请阅读最后评级说明和重要声明 零跑汽车（9863.HK） cjzqdt11111 2024-12-03 港股研究丨公司点评 [Table_BaseDat ...

Group 1 - The core viewpoint of the report indicates that Leap Motor's operational performance improved in the third quarter, with a year-on-year sales increase of 95% to 86,000 units and a revenue growth of 74% to 9.86 billion yuan [1] - The growth is attributed to the support of the old car replacement subsidy policy and the company's continuous launch of new models to meet consumer demand, with expected monthly sales to remain between 25,000 to 40,000 units [1] Group 2 - The firm maintains a "Outperform" rating for Leap Motor and raises the target price from 30.1 HKD to 46.1 HKD [2]

[Table_MainInfo] 公司研究/汽车与零配件/汽车 证券研究报告 零跑汽车（9863）公司公告点评 2024 年 11 月 15 日 | --- | --- | |----------------------------------------------------------------|------------------------| | 股票数据 | | | 1 [ 1 T 月 ab 1 le 4 _ 日 S 收 to 盘 ck 价 I （ nf 港 o ] 币） | 32.20 | | 52 周股价波动（港币） | 18.64-42.20 | | 总股本/流通股本（百万股） | 1337/1116 | | 总市值 / 流通市值（百万港币） | 43050/35949 | | 相关研究 | | | [ 《 Ta 经 b 营 le 稳 _R 健 e 向 po 好 r ， tIn 智 fo 驾 ] | 投入加大，全方位与 | | Stellantis 开展合作》 2024.08.16 | | | 《零跑汽车（ 09863 | ）：厚积薄发，轻资产出 | | 海加速推进》 2024.07.16 ...

Investment Rating - Buy rating maintained for Leapmotor (9863 HK) [8] Core Views - Leapmotor's Q3 2024 results exceeded expectations, with gross margin improvement and record high per-vehicle profitability driven by product mix optimization and economies of scale [1][3][4] - The company achieved revenue of RMB 9 86 billion in Q3 2024, up 74 3% YoY, with net loss narrowing to RMB -6 9 billion [3] - Q3 2024 sales reached 86,000 units, approaching H1 2024 cumulative sales, with monthly sales hitting new highs [3] - Gross margin improved to 8 1% in Q3 2024, up 6 9pct YoY and 5 3pct QoQ, with per-vehicle gross profit reaching RMB 0 9 million, a historical high [4] - The company is entering a strong new product cycle globally, with plans to launch 2-3 new models annually over the next three years [5] Business Performance - Q3 2024 sales increased 94 4% YoY and 61 7% QoQ to 86,000 units, with July-September sales of 22,000, 30,000, and 34,000 units respectively [3] - Revenue per vehicle was RMB 114,000 in Q3 2024, down RMB 13,000 YoY but up RMB 14,000 QoQ due to increased C-series contribution (78 3% of sales) [3] - October 2024 orders exceeded 40,000 units, indicating strong momentum for Q4 2024 [3] - Sales and administrative expense ratio decreased to 9 0% in Q3 2024, down 2 5pct YoY and 5 4pct QoQ [4] - R&D expense ratio was 7 9% in Q3 2024, down 0 5pct YoY and 5 2pct QoQ [4] Product and Market Strategy - Leapmotor covers the RMB 50,000-200,000 price segment and has expanded internationally with T03 and C10 models [5] - The company plans to launch 3 B-series models in 2025, priced between RMB 100,000-150,000, including the compact SUV B10 in Q1 2025 [5] - Domestic sales network includes 493 sales outlets and 362 service centers across 204 cities as of September 2024 [5] - International presence includes 339 European outlets as of October 2024, with plans to exceed 500 global outlets by 2025 [5] - The company is accelerating autonomous driving development, planning to expand its team to 500 by end-2024 and introduce advanced ADAS features on the LEAP 3 5 platform in H1 2025 [5] Growth Outlook - Domestic growth driven by strong new product cycle and competitive pricing, with scale effects and product mix optimization expected to boost profitability [6] - International expansion through partnership with Stellantis enables asset-light overseas growth with low initial investment and rapid deployment [6] - Sales forecasts: 300,000 units in 2024, 500,000 units in 2025, and 750,000 units in 2026 [6]