Zhong Guo Neng Yuan Wang·2025-08-20 02:06Core Viewpoint - The Chinese bus industry is positioned to become a global leader in technology output, with significant growth potential in overseas markets over the next 3-5 years, driven by favorable national policies and improved product competitiveness [2]. Group 1: Market Dynamics - In the new energy bus segment, Chinese buses have surpassed their overseas competitors, while traditional buses have comparable technology and better cost-performance ratios [1][2]. - The end of the domestic price war is expected to create a positive resonance rather than a drag on the market, with demand recovering due to tourism and bus fleet updates [2][3]. Group 2: Profitability Outlook - The current market conditions suggest that achieving new high profitability levels is feasible, supported by the absence of price wars, an oligopolistic market structure, and better profit margins in overseas markets [3]. - The continuous decline in lithium carbonate costs is also expected to contribute positively to profitability [3]. Group 3: Market Valuation - The short-term goal is to challenge the market value peak seen during the 2015-2017 industry boom, while the long-term goal is to establish a new ceiling for the global bus industry [4]. Group 4: Investment Recommendations - Yutong Bus is highlighted as a model of high growth and high dividend potential, with projected net profits of 4.63 billion, 5.52 billion, and 6.68 billion yuan for 2025-2027, reflecting year-on-year growth of 12%, 19%, and 21% respectively [5]. - King Long Motor is noted for its rapid progress and significant profit recovery potential, with projected net profits of 440 million, 640 million, and 830 million yuan for 2025-2027, showing year-on-year growth of 182%, 45%, and 28% respectively [5].