智通财经网·2025-09-08 09:00Core Viewpoint - The article highlights the positive outlook for Zhongsheng Holdings (00881) amidst a challenging automotive market, indicating a potential turnaround in performance and valuation for the company as it navigates industry restructuring and focuses on growth opportunities in the new energy sector [1][2]. Company Performance - Zhongsheng Holdings' stock price rose over 3% on September 8, reaching 16.45 HKD, reflecting renewed market enthusiasm [1]. - The company is at a critical point for performance recovery after two years of industry adjustment, with expectations of improved profitability driven by market share consolidation and effective pricing policies [1][2]. - The company's net profit for the first half of the year fell below market expectations due to pressure on new and used car profitability, but management anticipates a market recovery [1][2]. Industry Outlook - Major financial institutions, including Citigroup and Morgan Stanley, express confidence in Zhongsheng Holdings, predicting a recovery in gross margins and profitability in the coming years [2]. - Citigroup forecasts a gross margin increase of 0.9 percentage points to 6.3% in the second half of the year, with projections of 7.3% and 8.2% for 2026 and 2027, respectively [2]. - Morgan Stanley emphasizes that the worst is likely over for Zhongsheng, citing stable growth in new car sales and automotive repair services as key factors for recovery [2]. Business Structure and Strategy - Zhongsheng Holdings is expanding its luxury car customer base, with active customers increasing by 15.2% to 4.54 million, and has optimized its channel network by adding 57 dealerships and 20 service centers [3]. - The company is strategically positioned to benefit from the stabilization of vehicle prices and the introduction of new luxury models, which may enhance business recovery [3]. - The automotive dealership industry is undergoing consolidation, with weaker dealers exiting the market, creating a more favorable operating environment for stronger players like Zhongsheng [3][4]. New Energy Transition - Zhongsheng Holdings is capitalizing on opportunities in the new energy vehicle sector, becoming the largest distribution channel for the "Wenjie" brand, which has positively impacted new car gross margins [4]. - The company anticipates that a return to profitability in fuel vehicle sales could generate significant after-tax profits, enhancing overall financial performance [4]. - The strategic focus on both traditional luxury vehicles and new energy vehicles positions Zhongsheng Holdings for sustained growth and improved valuation as the industry environment improves [4].