Investment Rating - The investment rating for Geely Automobile is "Buy" with a target price of HKD 22.50, indicating a potential upside of 34.1% from the current price of HKD 16.78 [2][8]. Core Insights - The report highlights the privatization of Zeekr, which is expected to further enhance internal resource integration and operational efficiency within Geely. This move is seen as beneficial for Geely's competitive positioning in the market [6]. - Geely's financial projections show significant revenue growth, with expected revenues of RMB 306.89 billion in 2025, reflecting a year-on-year growth of 27.8% [5][10]. - The report emphasizes the need for Geely to adjust its high-end brand strategy due to declining sales in this segment, particularly for Zeekr's models [6]. Financial Overview - Revenue projections for Geely are as follows: RMB 179.20 billion in 2023, RMB 240.19 billion in 2024, and RMB 306.89 billion in 2025, with corresponding growth rates of 21.1%, 34.0%, and 27.8% respectively [5][10]. - Net profit is projected to be RMB 5.31 billion in 2023, increasing to RMB 16.63 billion in 2024, but expected to decline to RMB 11.90 billion in 2025, reflecting a significant year-on-year decrease of 28.5% [5][10]. - The report indicates a projected earnings per share (EPS) of RMB 1.18 for 2025, with a price-to-earnings (P/E) ratio of 13.2 [5][10]. Market Position and Valuation - Geely's market capitalization is approximately HKD 169.11 billion, with a 52-week high of HKD 18.98 and a low of HKD 7.47 [4]. - The report notes that Zeekr's current valuation is low, with a projected price-to-sales (P/S) ratio of only 0.3x for 2025, significantly lower than competitors like Xpeng and Li Auto [6]. - The report suggests that the privatization of Zeekr will allow Geely to consolidate its assets and resources, potentially lowering costs and improving overall competitiveness [6].