Guotou Securities·2025-10-26 10:34Investment Rating - The investment rating for Great Wall Motors is "Buy-A" with a 6-month target price of 35.19 CNY per share [3][8]. Core Views - The report highlights that Great Wall Motors achieved a revenue of 61.25 billion CNY in Q3 2025, representing a year-on-year increase of 21% and a quarter-on-quarter increase of 17%. However, the net profit attributable to shareholders decreased by 31% year-on-year and 50% quarter-on-quarter [1]. - The sales volume in Q3 2025 reached 354,000 units, up 26% year-on-year and 13% quarter-on-quarter, with an average selling price (ASP) of 173,000 CNY, showing a slight decline year-on-year but an increase quarter-on-quarter [2]. - The company has a strong cash reserve of 48.6 billion CNY as of Q3 2025, with a net cash flow from operating activities of 12.2 billion CNY, reflecting a 153% year-on-year growth [3]. Summary by Sections Financial Performance - In Q3 2025, Great Wall Motors reported a gross margin of 18.4%, down 2.4 percentage points year-on-year and 0.4 percentage points quarter-on-quarter, primarily due to changes in sales structure and increased tax rates [2]. - The operating profit for Q3 2025 was approximately 3.3 billion CNY, down 4% year-on-year but up 9% quarter-on-quarter, with a corresponding profit per vehicle of about 9,400 CNY [2][9]. Market Outlook - The report anticipates that the high-end models, particularly the Tank and Wey series, will contribute significantly to profit growth, with new models expected to enhance market penetration [3][8]. - The transition of the economy brand is expected to accelerate, with Haval and Ora brands launching new models that could lead to a turnaround in sales and profitability [3]. Valuation Metrics - The projected net profits for Great Wall Motors for 2025-2027 are adjusted to 12.98 billion CNY, 20.01 billion CNY, and 23.51 billion CNY, respectively, with corresponding price-to-earnings ratios of 15.3, 9.9, and 8.4 times [8][9].