Investment Rating - The report maintains a "Buy" rating for Li Auto (LI.US/2015.HK) and raises the target price to $32.2, indicating a potential upside of 17% [3][10]. Core Insights - Li Auto's growth momentum for 2025 is driven by the launch of new models and expansion of its sales network, with a solid foundation for increased total deliveries this year [10]. - The company is focusing on international market expansion, which is expected to contribute to incremental growth over the next two years [10]. - Li Auto emphasizes the strategic importance of AI investments to ensure long-term competitive advantages [10]. Financial Projections - Revenue is projected to grow from RMB 123.9 billion in 2023 to RMB 259.4 billion by 2027, with a compound annual growth rate (CAGR) of 31% in 2026 [4]. - Gross margin is expected to stabilize around 20.9% by 2027, while net profit is forecasted to increase from a loss of RMB 11.7 billion in 2023 to a profit of RMB 17.5 billion in 2027 [4][11]. - The target price corresponds to a price-to-earnings ratio of 26.7x for 2025, which is considered attractive compared to peers [10]. Performance Review and Adjustments - In Q4 2024, Li Auto's revenue reached RMB 44.3 billion, a 6% year-over-year increase, while net profit was RMB 3.5 billion, down 38% year-over-year [12]. - The company reported a gross margin of 20.3% in Q4 2024, reflecting a decline due to the introduction of new models and cost pressures [12]. - Adjustments to revenue and profit forecasts for 2025 and 2026 have been made, with expected revenues of RMB 176.4 billion and RMB 230.5 billion respectively, reflecting a 12% reduction from previous estimates [14]. Valuation Methodology - The valuation is based on a sum-of-the-parts approach, applying different price-to-earnings ratios for automotive sales and other revenues, leading to a target price of $32.2 for Li Auto [18]. - The report also provides a target price of HKD 132.0 for Li Auto-W (2015.HK), reflecting similar growth expectations [6][18].

Investment Rating - The report maintains a "Buy" rating for the company, Li Auto (LI.US/2015.HK) [3][10] Core Views - The target price for Li Auto is raised to $32.2, indicating a potential upside of 17% [3][5] - The target price for Li Auto-W is set at HKD 132.0, also reflecting a potential upside of 17% [6][10] - The growth momentum for 2025 is expected to come from new model launches and expansion into overseas markets, alongside a strategic focus on AI investments [10][30] Financial Projections - Revenue is projected to grow from RMB 123,851 million in 2023 to RMB 259,382 million by 2027, with a compound annual growth rate (CAGR) of 31% in 2026 [4][11] - Gross margin is expected to stabilize around 20.9% by 2027, after a slight decline in the earlier years [4][11] - Net profit is forecasted to improve from a loss of RMB 11,704 million in 2023 to a profit of RMB 17,543 million by 2027 [4][11] Performance Review - In Q4 2024, the company reported revenue of RMB 44,274 million, a 6% year-over-year increase, with a net profit of RMB 3,523 million, down 38% from the previous year [12][10] - The gross margin for Q4 2024 was 20.3%, reflecting a decline compared to the previous year due to increased costs associated with new model launches [12][10] Market Expectations - The report highlights that the demand for new energy vehicles in China, particularly in the high-end segment, is expected to drive sales growth for Li Auto [30][35] - The company aims to enhance its AI capabilities and expand its retail network, with plans to open over 200 retail showrooms and 60 pop-up stores nationwide [10][30]