Cinda: LEAPMOTOR (09863) will turn profitable in the fourth quarter of 2024, with an expected gross profit margin of not less than 8% compared to last year.

Cinda released a research report stating that LEAPMOTOR (09863) has a high self-developed and self-manufactured ratio for its core components. It achieved positive net profit for a single quarter in Q4 2024, and the bank is optimistic about the company's rapid domestic sales growth and steady progress in overseas markets. The company expects its revenue in 2024 to be no less than 30.5 billion yuan, with a year-on-year increase of no less than 80%; and expects the gross profit margin in 2024 to be no less than 8%, with a significant year-on-year increase. In addition, the company achieved positive net profit in Q4 2024, achieving the goal of positive net profit for a single quarter one year ahead of schedule. Cinda's main points are as follows: Significant sales growth driving revenue growth. The company expects its revenue in 2024 to be no less than 30.5 billion yuan, with sales of 293,724 units in 2024, a year-on-year increase of 104%. It is estimated that the revenue in Q4 2024 will be no less than 11.79 billion yuan, with sales of 121,000 units, up 40% month-on-month. Impressive gross profit margin performance in Q4 2024. The company expects its gross profit margin in 2024 to be no less than 8%, which implies a gross profit margin of at least 13% in Q4 2024, an increase of 5 percentage points month-on-month. The improvement in gross profit margin for the whole year is mainly due to: 1) the scale effect brought by sales growth; 2) continuous optimization of the company's product sales structure; and 3) ongoing cost management efforts by the company. The company achieved positive net profit in Q4 2024, ahead of the target to achieve positive net profit for a single quarter one year ahead of schedule. The positive net profit in Q4 2024 is mainly due to: 1) the continuous growth in sales in Q4 2024, with an average monthly sales of over 40,000 units; 2) the optimization of the company's product structure, with sales of higher-priced C series models accounting for over 77%; and 3) effective cost control and operational efficiency by the company. Built on the Leap 3.5 architecture, the B series is expected to bring in new volume. The B series will be fully launched in 2025, with the first global model, the Leap B10, set to be officially launched in Q1 2025. The Leap B10 will be equipped with the industry's only solution of laser radar + 8650 chip for intelligent driving, capable of high-speed and urban automatic navigation assistance, and will support end-to-end large-scale models; the intelligent cockpit will adopt the 8295 chip. In addition, two more B series products will be launched globally in 2025. Steady progress in overseas markets. Since it started selling in Europe and other regions in September 2024, Leap has established over 400 sales outlets in 13 European countries, with plans to expand to 500 outlets by the end of 2025. In addition to the already launched Leap C10 and T03 overseas, Leap plans to launch 5 new models in the next three years.