HK Stock Market Move | LI AUTO (02015) fell nearly 4% in early trading. Recent launch of replacement subsidies to safeguard rights and interests Large concerns dragging down first quarter earnings and triggering price war.

LI AUTO-W (02015) fell nearly 4% in early trading, dropping 3.22% to HK$88.6 as of the press time, with a turnover of HK$5.74 billion. On the news front, LI AUTO recently introduced a subsidy to replace the subsidy guarantee. Users who order and deliver LI AUTO from January 1 to January 31, 2025, and do not meet the local replacement subsidy conditions before March 31 if the local replacement subsidy has not been issued, can enjoy a cash subsidy of 15000 yuan per vehicle provided by LI AUTO. According to a research report by Citigroup, in order to alleviate the impact of the subsidy expiration, LI AUTO and about ten other car companies have announced various car purchase incentives. The bank believes that the series of measures introduced by car companies are aimed at coping with the sales slowdown in early 2025, but may have a negative impact on first-quarter profits this year. BOCOM INTL also stated that caution is needed as the car market enters a sales downturn after a sales surge in December last year, leading to intensified market competition and price wars.