Huachuang Securities·2026-03-02 09:46Investment Rating - The report maintains a "Strong Buy" rating for Geely Automobile (00175.HK) with a target price of HKD 26.13, indicating a potential upside of 62% from the current price of HKD 16.15 [2][6]. Core Insights - Geely's February sales reached 206,000 units, showing a year-on-year increase of 0.6% but a month-on-month decrease of 23.7%. Exports were particularly strong, with 61,000 units sold, a year-on-year increase of 140% [1]. - The company is expected to continue its growth trajectory with total revenue projected to reach RMB 241.1 billion in 2024, growing to RMB 479.4 billion by 2027, reflecting a compound annual growth rate (CAGR) of 33.5% [1][7]. - Net profit attributable to shareholders is forecasted to increase significantly from RMB 16.6 billion in 2024 to RMB 27.8 billion in 2027, with a remarkable growth rate of 213.3% in 2024 [1][7]. - The report highlights the launch of competitive new models and a strong focus on high-end products, which are expected to drive sales and profitability [6][7]. Financial Summary - Total revenue projections for Geely are as follows: - 2024: RMB 241,099 million - 2025: RMB 348,925 million - 2026: RMB 428,959 million - 2027: RMB 479,364 million - Net profit attributable to shareholders is projected to be: - 2024: RMB 16,632 million - 2025: RMB 17,402 million - 2026: RMB 25,046 million - 2027: RMB 27,813 million - Earnings per share (EPS) is expected to grow from RMB 1.65 in 2024 to RMB 2.57 in 2027 [1][7]. Market Performance - Geely's stock has shown resilience despite market challenges, with a current price-to-earnings (P/E) ratio of 6.2 for 2026, indicating a significant valuation opportunity compared to historical levels [6][7]. - The report anticipates a recovery in the automotive sector, driven by new model launches and improved retail conditions, which could enhance Geely's market position [6][7].