Zhi Tong Cai Jing·2025-12-15 02:06Core Viewpoint - The report from Industrial Securities initiates coverage on Zhongsheng Holdings (00881) with a "Buy" rating, highlighting its position as a leading luxury car dealer in China and its efforts to build a high-end automotive service brand, which supports steady growth in after-sales business [1] Group 1: High-End Automotive Service Brand Development - Zhongsheng is focusing on creating a "Chinese high-end automotive service brand," targeting 32 key cities and millions of luxury car owners, which enhances its local market business density and brand concentration [2] - As of June 30, 2025, 46% of Zhongsheng's 439 stores are led by local brands, with 89 being exclusive local dealers; it serves 14.6% of the 2.01 million luxury car owners in its main coverage cities [2] - The company has 454 million active customers, a year-on-year increase of 15.2%, with significant percentages of customers returning for maintenance and repairs [2] Group 2: Network and Product Improvement - Traditional automotive brands are improving their supply-side networks and products, with companies like Toyota and Audi collaborating with third-party suppliers to launch smart models, enhancing dealer margins [3] - Zhongsheng has completed a significant network optimization, including the restructuring of existing stores and the addition of 57 new dealerships and 20 service centers, with over 20% of stores participating in this adjustment [3] - The new dealerships include 48 luxury brand stores, enhancing the company's service capabilities and market presence [3]