Major Bank Rating | CICC: Bullish on Xiaomi, Geely Auto, and NIO in the automotive sector, all rated as "Buy"

BOCI Research Report pointed out that the overall stock prices of automobile stocks in the Hong Kong stock market have still lagged behind various fundamental indicators since the beginning of the year, attributing the difference mainly to the market's pessimistic sentiment towards the macro market and the automobile industry. The bank mentioned that entering the fourth quarter of this year, which is also the traditional peak season for automobiles, it is expected that with the strong product cycle and the boost from contract manufacturers whose valuations are at historical lows, the overall industry valuation will rebound significantly. The bank is optimistic about Xiaomi, Geely Auto, and NIO. The bank reiterated a "buy" rating for Xiaomi, pointing out that the launch of new products in late October will be the next catalyst, expecting monthly deliveries of the SU7 to exceed 20,000 units in the fourth quarter, as well as promotional activities for the next electric vehicle product to be launched in early 2025. The bank also gave a "buy" rating for Geely, expecting that the market's upward revision of profit forecasts will help drive its valuation recovery, with short-term catalysts including market response to flagship models in the second half of the year and continued operational integration at the group level. As for NIO, driven by a strong new product cycle, meaningful narrowing of losses, and improvement in cash flow, the bank maintains a "buy" rating with a target price of $9. Additionally, the bank maintains a "buy" rating for BYD with a target price of HKD 265