CICC: Maintaining Geely Auto's (00175) “Outperform the Industry” Rating Target Price of HK$20.50
The Zhitong Finance App learned that CICC released a research report stating that it maintains Geely Auto's (00175) “outperforming the industry” rating. The target price is HK$20.50, corresponding to price-earnings ratios of 2026 and 2027, respectively, of 9.0 times and 7.5 times, respectively. There is 48.1% room for an upward trend compared to the current stock price. The bank expects the company's net profit for 2026 and 2027 to be 21.3 billion yuan and 24.9 billion yuan respectively. The company's results for the third quarter of 2026 were in line with the bank's expectations, achieving revenue of 98.96 billion yuan and net profit of 4.84 billion yuan to mother. The bank believes that high export growth combined with extreme krypton emissions is expected to support sales growth and product structure optimization.
CICC's main views are as follows:
Results for the third quarter of 2026 are in line with expectations
The company announced results for the third quarter of 2026. Revenue for the third quarter was 98.96 billion yuan, up 10.3% year on year and 10.2% month on month; net profit to mother was 4.84 billion yuan, up 27.5% year on year. Revenue for the first three quarters of 2026 was 272.56 billion yuan, up 13.1% year on year; net profit to mother was 13.93 billion yuan, up 6.7% year on year. Third-quarter results are in line with this forecast.
High export growth led to a recovery in sales, and bicycle revenue increased year-on-year
In the first three quarters of 2026, the company's sales volume increased 3% year on year to 2,235,500 units, and the third quarter sales increased 7% year on year and 14% month on month to 812,500 units. Among them, GKrypton, Linker, and Galaxy sold 110 million units, 51,900 units, and 357,400 units respectively. Extreme Krypton and Galaxy increased 108% and 9%, respectively.
Exports continued to grow at a high rate. In the third quarter, exports increased 189% year on year, 19% month on month to 323,400 units, and domestic sales volume was 489,000 units. Bike revenue in the third quarter was 122,000 yuan, an increase of 3% over the previous year. The bank believes that high export growth combined with extreme krypton emissions is expected to support sales growth and product structure optimization.
Gross margin improved year over year, and core profit remained steady
In the third quarter of 2026, the company's gross margin was 18.0%, an increase of 1.5 percentage points over the previous year. Expense control was good during the period. The sales, management and R&D expenses ratio was 12.5%, an improvement of 0.5 percentage points over the previous month.
Excluding effects such as exchange gains and losses, core net profit increased 32% year on year and 2% month on month to 5.21 billion yuan. Core net interest rate was 5.3%, up 0.9 percentage points year on year; bicycle core net profit was about 6,415 yuan, up 24% year on year. The bank believes that the release of high-end models and overseas expansion are expected to support profit improvement.
The new product cycle continues to advance, and the overseas channel layout is deepening
In September 2026, the Galaxy TT and the Galaxy Battleship 700 were launched successively in October, enriching the NEV product matrix. Overseas, Lynk & Co reached an exclusive distribution agreement with Volvo in Europe to accelerate overseas market expansion. On the technical side, the company released AI ultra-fast charging technology to continue to strengthen the advantages of energy supplementation. The bank believes that the volume of new products combined with overseas channels and technical collaboration is expected to continue to enhance the company's global competitiveness.
Risk Alerts
Risk of trade friction; increased market competition; new energy business development falls short of expectations.