Bank of America Securities: Reiterates "Buy" rating on XPENG-W (09868) with target price raised to 63.2 Hong Kong dollars.

Bank of America Securities has released a research report stating that considering the strong product line starting from the end of this year, they have reiterated a "buy" rating for XPENG-W (09868), raising sales forecasts for 2024 to 2026 by 7%, 17%, and 8% respectively. They have also reduced the gross profit margin forecast with lower effective costs. It is expected that the non-GAAP net loss forecast for the next two years will be reduced by 15% and 13% respectively, with the target price raised from 61.2 Hong Kong dollars to 63.2 Hong Kong dollars. XPENG's third-quarter performance exceeded market expectations, with a gross profit margin increasing by 17.9 percentage points year-on-year to 15.3%, better than the expected 14.2%. Operating expenses accounted for 32.3% of sales, a decrease of 2.8 percentage points year-on-year. XPENG plans to launch at least four new car models next year, with the bank predicting that the company's sales next year will reach 431,000 vehicles, a year-on-year increase of 128%. In addition, the P7+ has started delivery this month and is expected to contribute to high gross margins and stimulate an increase in sales volume, helping the company achieve quarterly improvement in car gross margins in the fourth quarter of this year. Bank of America Securities also mentioned that XPENG expects to deliver 87,000 to 91,000 vehicles in the fourth quarter, a year-on-year increase of 45% to 51%, with expected revenue of 15.3 billion to 16.3 billion RMB, a year-on-year increase of 17% to 24%, better than the bank's previous expectations.