Core Viewpoint - The company has adjusted the target prices for Li Auto (LI.US) to $26.4, indicating a potential upside of 17%, and for Li Auto-W (2015.HK) to HKD 102.6, indicating a potential upside of 16% while maintaining a "Buy" rating due to expected stable gross margins despite fluctuations in vehicle sales guidance for Q3 [1][2]. Group 1: Financial Performance - In Q2, the company's revenue reached RMB 30.2 billion, a year-on-year decrease of 5% but a quarter-on-quarter increase of 17% [2]. - The gross margin was 20.1%, with the automotive sales gross margin at 19.4%, reflecting a year-on-year increase of 0.7 percentage points and a quarter-on-quarter decrease of 0.3 percentage points, indicating relative stability [2]. - The company has provided a Q3 delivery guidance median of 92,500 vehicles, with a revenue median of RMB 25.5 billion, representing a year-on-year decline of nearly 40% and a quarter-on-quarter decline of about 16% primarily due to fluctuations in L-series sales [2]. Group 2: Strategic Initiatives - The company is actively adjusting and optimizing its sales strategy, including direct management from headquarters, localized approaches, and penetrating lower-tier markets to boost sales motivation [2]. - An investment of RMB 6 billion in artificial intelligence is anticipated this year, with the VLA large model expected to be integrated into the AD MAX model via OTA updates in September [2]. - The company expects cumulative deliveries of the i8 model to reach 8,000-10,000 units by the end of September, with the i6 model set to launch [2]. Group 3: Valuation - The company employs a sum-of-the-parts valuation method, using price-to-sales ratios of 1.6x for automotive sales and 0.9x for other revenues, leading to a target price of $26.4 for Li Auto (LI.US) and HKD 102.6 for Li Auto-W (2015.HK) [3].

Core Viewpoint - Deutsche Bank's report suggests that the recent weakness in Li Auto's stock price may present a buying opportunity, particularly with the upcoming launch of the i6 model aimed at the mass market [1] Summary by Relevant Sections Stock Performance - Li Auto's stock has experienced a decline, attributed to market concerns regarding the order flow for the newly launched i8 model [1] - As of early August, the company's nationwide weekly new orders decreased by approximately 29% month-over-month [1] Market Sentiment - Negative comments on social media regarding the company's safety-related advertising campaigns may have contributed to the decline in orders [1] - The relatively small market for high-end electric SUVs could also be a factor in the reduced order flow [1] Future Outlook - Deutsche Bank anticipates that the new order flow for Li Auto will begin to recover starting at the end of the month [1]