[ET Net News Agency, 23 November 2020] Daiwa Research lifted its target price for
Guangzhou Automobile Group (GAC) (02238) to HK$10.8 from HK$9 and reiterated its
"outperform" rating.
The research house noted that GAC announced on 19 November its plans to produce and sell
3.5m cars during 2021-25, of which 20% would be NEVs (new energy vehicle). According to
the production plan, annual sales will reach 700k units on average over 2021-25, of which
140k units would be NEVs.
Daiwa believes that with more NEV models to be launched and price per mileage likely to
decline, the 140k-unit annual average is achievable. However, the annual target of 560k
units of ICEs (internal combustion engine) over 2021-25 seems more aggressive, given that
ICE sales were 504k units in 2017 and 515k units in 2018, before the decline in China's PV
market. (KL)
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02238 GAC GROUP
Nominal 
3.170 +0.020 (+0.635%) Research Report
23/11/2020 11:05
{I-bank focus}Daiwa lifts GAC Group (02238) to HK$10.8
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