Guotou Securities·2025-10-31 04:09Investment Rating - The investment rating for BYD is "Buy-A" with a 6-month target price of 135.70 CNY per share [5][8]. Core Views - The report indicates that BYD's Q3 2025 performance shows a slight decline in revenue but an improvement in profitability, with expectations for continued recovery in sales volume and profit margins [1][5]. - The company is expected to benefit from a traditional sales peak in Q4, new model launches, and an improved sales structure, which should enhance profitability [5][8]. Revenue Summary - In Q3 2025, BYD achieved automotive revenue of 152.3 billion CNY, down 3% year-on-year and quarter-on-quarter, primarily due to a decline in sales volume and changes in sales structure [2]. - The total vehicle sales for Q3 2025 were 1.106 million units, reflecting a decrease of 2.1% year-on-year and 1.9% quarter-on-quarter [2]. Profit Summary - The automotive gross margin for Q3 2025 was 20.6%, a decrease of 2.7 percentage points year-on-year but an increase of 1.9 percentage points quarter-on-quarter, attributed to the recovery of terminal discounts and decreasing costs [3]. - The net profit for Q3 2025 was 7.8 billion CNY, down 33% year-on-year but up 23% quarter-on-quarter [1][3]. Cash Position - As of the end of Q3 2025, BYD had cash and cash equivalents totaling 117.5 billion CNY, significantly up from 65.8 billion CNY at the end of Q3 2024, indicating a strong cash reserve [4]. Outlook Summary - The company anticipates a recovery in both sales volume and profit margins, driven by new model launches and adjustments in pricing strategies [5]. - The high-end product line and international expansion are expected to contribute positively to sales and profitability in the coming years [5].