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<Research>Citi: NIO-SW Inventory at Healthy Lv.; Near-term Outperformance vs LI AUTO-W
Recommend 29 Positive 40 Negative 15 |
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Citi research report estimated the inventory conditions of multiple Chinese automakers as of end-April based on the latest data from the China Passenger Car Association (CPCA). The broker noted that NIO-SW (09866.HK) maintained inventory at a healthy and optimal level, with an estimated accumulation of about 40,000 new vehicles by end-April to meet May delivery demand, making it a standout in the industry and supporting its May deliveries. Standing in contrast, LI AUTO-W (02015.HK) kept inventory at a relatively high level, and any inventory reduction measures could erode its 2Q margins and may even partly affect 3Q margins. Among other automakers, NIO-SW and LEAPMOTOR (09863.HK) were both at a "sweet spot" in terms of inventory, with inventory months subtracting by 0.3 months MoM to 1.4 months. Inventory levels of BYD COMPANY (01211.HK) and GEELY AUTO (00175.HK) were in line with market expectations. BYD COMPANY recorded 2.7 months of inventory at end-April, slightly up from 2.6 months in March, while GEELY AUTO stood at 2.4 months, up from 2.1 months in March. XPENG-W (09868.HK) maintained stable inventory, with only a slight MoM rise. Citi expected NIO-SW to outperform LI AUTO-W in the near term. NIO-SW had 1.2 months of inventory at end-April, a surge from 0.2 months in March, mainly to prepare for May deliveries. LI AUTO-W also logged 1.2 months of inventory at end-April, up from 0.9 months in March. Although CHERY AUTO (09973.HK) saw a MoM shrinkage in inventory, its inventory months remained at a relatively high level of 4.3 months. Citi believed that if China's passenger vehicle retail sales drop MoM in May, elevated inventory levels may further pressure margins during the mid-year inventory clearance in June. Auto-translated by AI This article was automatically translated by AI, the original language version should be considered the authoritative version. AASTOCKS.com Limited does not guarantee its accuracy or completeness and accepts no liability for any damages or losses arising from the use of this translation. More Details
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