Great Wall Motors re-enters the top 2 in market value among Chinese car companies, as Deutsche Bank and Citigroup both raise their ratings.
"The Great Wall has been 'targeted'."
Don't worry, it's a hopeful gaze.
JPMorgan Chase has just announced that it has upgraded its rating on Great Wall Motors' A-shares and H-shares to overweight.
In the first half of this year, the financial performance of the Great Wall, a leading domestic giant, was impressive: revenue reached 91.429 billion yuan, an increase of 30.67% year on year, achieving continuous growth for four years; net profit was 7.079 billion yuan, a significant increase of 419.99% year on year; the profit per vehicle reached 12,800 yuan, nearly five times that of last year.
Citi, UBS, CICC and other domestic and foreign institutions have all raised their financial expectations for Great Wall Motors, and have expressed their attitude in advance towards the third quarter financial report at the end of the month.
The Great Wall is playing a big game.
On October 10th, J.P. Morgan upgraded its rating on Great Wall Motors' A-shares to overweight, and its H-shares rating was also upgraded to overweight.
In other words, analysts believe that the stock performance of Great Wall will outperform the market average, and recommend investors to allocate a higher-than-average weight to Great Wall in their investment portfolios.
In fact, the current Great Wall Motors is increasingly favored by the capital market. Several institutions have adjusted their ratings for Great Wall, including target prices.
Citi published a related research report at the end of September, raising the target price of Great Wall Motors H shares from 17.5 Hong Kong dollars to 20.2 Hong Kong dollars, maintaining a "buy" rating.
Combining the financial situation, Citigroup has also raised its financial expectations for Great Wall Motors, predicting that its gross profit margin for this year will be increased by 1.2 percentage points to 19%; the profit margin in the third quarter will show outstanding performance, and the higher sales volume may be maintained in the fourth quarter of this year.
Looking further ahead, Citigroup predicts that the net profits of Great Wall Motors will reach 13 billion yuan, 15 billion yuan, and 17.5 billion yuan respectively in fiscal years 2024 to 2026.
The domestic Dongwu Securities has also paid attention to Great Wall Motors. In a research report issued on October 9th, they gave a "buy" rating to Great Wall Motors, predicting that its net profit attributable to shareholders for the years 2024 to 2026 would be 13.2 billion yuan, 15 billion yuan, and 18.6 billion yuan respectively, with year-on-year growth rates reaching 88%, 14%, and 24%.
From the recent trend in the stock price of Great Wall Motors, one can also see this wave of "preference":
After the release of the semi-annual performance report, the stock price began to show an upward trend. As of now, it has surged by more than 70%, and Great Wall Motors' market value has risen to the second among Chinese auto companies.
The Great Wall is expected by the market mainly due to its impressive financial performance in the first half of this year.
The interim report released on August 30th shows that Great Wall Motors' first-half operating income was 91.429 billion yuan, a year-on-year increase of 30.67%, marking the fourth consecutive year of growth.
Net profit in the first half of the year reached 7.079 billion yuan, an increase of 419.99% compared to the same period last year.
The net profit of bicycles is 12,800 yuan, an increase of 10,100 yuan year-on-year.
Gross profit in the first half of the year was 18.962 billion yuan, a year-on-year increase of 60.82%; the growth in gross profit led to a rise in the gross profit margin to 20.74%, an increase of 3.89 percentage points from the same period last year, setting a record high for gross profit margin in the past 7 years.
Shifting the focus from the company itself to the market, the performance of Great Wall is also good:
Firstly, the acceleration of new energy transformation and intelligentization is helping Great Wall Motors break through in the domestic market.
In the transition to new energy, Great Wall has made progress in hybrid, pure electric, and hydrogen energy routes.
Especially in the field of hybrid technology, Great Wall has introduced the intelligent four-wheel drive hybrid technology Hi4, which features dual electric motors on the front and rear axles in a series-parallel configuration. It aims to deliver both power and energy efficiency, and has been applied to various models including Wei Pai and Haval.
Afterwards, the Great Wall continued to iterate on the Hi4 technology, introducing the Hi4 Performance version and Hi4-T technology, which were optimized for medium and large-sized vehicles and hardcore off-road vehicle models respectively.
On the hydrogen energy technology front, Great Wall Motors is also exploring. At this year's Hanover International Transport Show in Germany, Great Wall's hydrogen energy brand, Wey Energy, showcased a series of hydrogen fuel cell engines, long-distance hydrogen transportation solutions, and supply chain systems among a series of achievements.
From January to September this year, Great Wall Motors sold a total of 211,492 new energy vehicles, a year-on-year increase of 24.15%; in September, Great Wall Motors' new energy penetration rate reached 27.8%, and the export rate reached 40.7%.
In terms of intelligence, with the end-to-end SEE architecture in hand, the Great Wall has taken the path of "integration of software and hardware".
On September 20th, led by Great Wall Technology, the jointly developed RISC-V automotive chip, Zi Jing M100, has been successfully developed and powered on. This not only showcases the strength of Great Wall's technological innovation, but also marks the beginning of the domestic RISC-V automotive ecosystem.
In the first half of the year, Great Wall also launched a new generation of intelligent driving system Coffee Pilot Ultra, as well as a new generation of intelligent space system Coffee OS 3, combining the two to boost comprehensive advancement in intelligent performance.
The first end-to-end intelligent driving model that carries the "heart and soul" of intelligence is the Weipai's all-new Blue Mountain, which comes in both the Intelligent Driving Max version and Intelligent Driving Ultra version.
Without relying on high-precision maps, standard equipped with City NOA, equipped with 27 sensors including LiDAR, cameras, and NVIDIA Orin-X chip, with computing power reaching 254 TOPS. Moreover, the cabin's interactive response time is very short, with both systems achieving 96ms, far surpassing the leading companies in the industry. Wei Jianjun himself came to the stage in person.
This vehicle model is equipped with an end-to-end system, using a segmented network architecture that integrates perception, decision-making, planning, and other processes. It replaces rule-based driving with data-driven methods, enabling the model to learn directly how to drive like a human driver. This allows it to better handle significantly more complex road conditions and make driving decisions that are closer to human behavior.
In complex road conditions like in Baoding and Chongqing, the Smart Driving Edition Lingshan has live tested and challenged the entire scenario without using any maps NOA.
Relying on end-to-end technology, the Great Wall has achieved overtaking in the field of intelligent driving.
In the words of Wei Jianjun, Great Wall Motors now has the ability of "self-developed full vehicle" and "end-to-end controllable full stack". Among domestic and even global traditional automakers, Great Wall Motors is the first to truly mass-produce and deliver end-to-end intelligent driving systems.
The sales report shows that a total of 6108 units of the new Blue Mountain with intelligent driving function were sold in September, representing a significant year-on-year increase of 201.48%.
From September 9th to 15th, the all-new Blue Mountain SUV topped the sales charts, with sales in a single week almost matching the sales of the old Blue Mountain model for a whole month. It has become one of the main forces for Great Wall Motors to compete in the domestic market.
In addition to the brand-new Blue Mountain, the Great Wall also has another main support, which is the hardcore off-road tank. Off-road performance and intelligent technology are being combined on tank brands.
Example like Tank 400 Hi4-T, equipped with CoffeePilot L2 intelligent driving assistance system, equipped with adaptive cruise control, intelligent cruise control, lane-keeping and other driving assistance functions to ensure driving safety.
From January to September, tank sales were 169,810 vehicles, a year-on-year increase of 62.43%; sales in September were 18,740, a year-on-year increase of 3.28%.
As a luxurious SUV brand, Tank has maintained a high market share, providing Great Wall with both sales and profit safeguards.
Next, the Great Wall's pace of going global has accelerated, and results are already being seen in its overseas market layout.
Since the beginning of the year, the five major brands of the Great Wall have successively entered the overseas market. On the one hand, based on market preferences, they have taken root in places like Dubai and Australia to accelerate the transformation of the overseas market to new energy sources. On the other hand, they have established factories and production bases in Thailand, Vietnam, Brazil, and other places, driving global production layout and better understanding and delving into local markets.
As an old car maker, Great Wall Motors has a history of going global for more than twenty years.
In the first half of the year, Great Wall's overseas sales channels exceeded 1,300, with a global user base exceeding 14 million. The overseas cumulative sales volume has already exceeded 1.6 million vehicles.
From January to September, overseas sales reached 324,244 units, a year-on-year increase of 53.16%, exceeding the total overseas sales for the entire year of 2023.
With these developments in progress, the work is not yet complete. In the upcoming months of this year, Great Wall Motors still has reserved projects. The second-generation Haval H9, set to be launched by the end of September, as well as the revamped Tank 300 model, may bring new opportunities for Great Wall Motors' sales.
In light of all this, the market has high expectations for Great Wall Motor, with many institutions raising their earnings forecasts for the company. It is not difficult to understand why.
At the end of this month, the financial report for the third quarter of the Great Wall will be disclosed.
Reevaluate the Great Wall, it is time.
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