Tracking Hong Kong Stock Concepts | Subsidy policy rollback expectations combined with the countdown to exemption from purchase tax stimulate the warming up of the car market, focusing on high-quality track core targets (with concept stocks)

Recently, the UK market research company Rho Motion stated that driven by strong demand in the Chinese market and the wave of tax incentives in the US, global sales of electric vehicles in September increased by 26% year-on-year, reaching a record 2.1 million units. Charles Lester, data manager at Rho Motion, stated that China remains the largest electric vehicle sales market globally, and the North American market also set a sales record as American buyers took action before the electric vehicle subsidy incentive expired at the end of September. On the domestic front, on October 13, the China Association of Automobile Manufacturers released the production and sales data for domestic passenger vehicles in September 2025. The data showed that retail sales of passenger vehicles in China totaled 2.241 million units in September, a 6.3% year-on-year increase. From January to September, cumulative retail sales of passenger vehicles in China reached 17.05 million, up 9.2% year-on-year. It is worth noting that the retail sales volume in September this year reached a new high, with an increase of 50,000 units compared to the historical highest level of 2.19 million units in September 2017. Regarding the growth in passenger car sales in September, Cui Dongshu, the Secretary-General of the China Association of Automobile Manufacturers, stated that there are two main reasons. Firstly, a large number of new products were launched in September, driving rapid market growth. It is estimated that more than 70 new car models were launched in September this year, the highest number ever, and many new cars were priced lower than consumer expectations, leading to continuous consumer spending in the auto market. Secondly, in terms of policies, the expiration of the tax exemption for new energy vehicle purchases in September, along with the announcement of a 5% increase in vehicle purchase tax next year, made consumers feel a sense of urgency to buy cars, leading to a continued increase in market consumption. The strong performance of the automotive sector has resulted from the concentrated fermentation of multiple policy favorable factors, forming a resonance between short-term stimuli and long-term support. In terms of short-term stimuli, the stabilization of the purchase tax policy has set market expectations: the announcement of the "Announcement on the Technical Requirements for Full Exemption of Vehicle Purchase Tax for New Energy Vehicle Products in 2026-2027", from January 1, 2026, the ten-year full exemption of vehicle purchase tax policy for new energy vehicles will be switched to a half reduction mode. In terms of long-term policy support, the eight departments have outlined a development blueprint for stable growth, with the "Automotive Industry Stable Growth Work Plan (2025-2026)" jointly issued by the Ministry of Industry and Information Technology and seven other departments clearly specifying industry development goals: a target of 32.3 million total vehicle sales in 2025 (3% year-on-year growth), 15.5 million sales of new energy vehicles (20% year-on-year growth), and a penetration rate close to 50%. Orient believes that the transition of the purchase tax policy and the stable growth plan constitute a double boost, combined with the arrival of the traditional consumer peak season in Q4, the automotive sector is expected to see a "policy + performance" double impact. In addition, this year, as some regions gradually suspend or adjust the subsidies for trade-ins, many consumers are eager to take advantage of the subsidy opportunities before they are suspended, leading to particularly strong growth in electric vehicle sales in September. Shen Gang Securities pointed out that attention should be paid to undervalued leading companies in the automotive sector that have improved performances in both the whole vehicle and parts segments, as well as core targets in the high-quality tracks of electrification and intelligence. Therefore, it is recommended to pay attention to: Independent car companies that have a first-mover advantage in the new energy field, such as BYD Company Limited, Chongqing Changan Automobile, GEELY AUTO, Ideal Automobile, etc; Stable performing undervalued leading parts companies, such as Huayu Automotive Systems, Fuyao Glass Industry Group, etc; Core targets in the high-quality tracks of electrification and intelligence, such as Huizhou Desay SV Automotive, Suzhou Recodeal Interconnect System, Keboda Technology, Bethel Automotive Safety Systems, etc; Opportunities brought about by the "domestic circulation", such as Wuhan Lincontrol Automotive Electronics Co., Ltd., Zhejiang Sanhua Intelligent Controls, Changzhou Xingyu Automotive Lighting Systems, Suzhou Sonavox Electronics Co., Ltd., Anhui Zhongding Sealing Parts, etc. Related concept stocks: BYD Company Limited (01211): BYD Company Limited announced that in September 2025, the production of new energy vehicles was approximately 405,600 units, with sales of approximately 396,300 units. From January to September, the production of new energy vehicles reached approximately 3.2136 million units, up 16.4% year-on-year, and sales reached approximately 3.2601 million units, up 18.64% year-on-year. LI AUTO-W (02015): LI AUTO-W announced that in September 2025, Ideal Automobile delivered 33,951 new cars. In the third quarter of 2025, Ideal Automobile delivered a total of 93,211 cars. As of September 30, 2025, Ideal Automobile's historical cumulative delivery volume reached 1,431,021 units. XPENG-W (09868): XPENG-W announced that in September 2025, Xiaopeng Motors set a record by delivering 41,581 smart electric vehicles, a 95% year-on-year increase, a 10% increase from the previous month, surpassing the milestone of delivering 40,000 vehicles per month. In the third quarter of 2025, Xiaopeng Motors delivered a total of 116,007 smart electric vehicles, up 149% year-on-year. In the first nine months of 2025, Xiaopeng Motors' cumulative delivery volume reached 313,196 units, a 218% increase from the same period in 2024. NIO-SW (09866): NIO-SW announced that in September 2025, the company delivered 34,749 vehicles, setting a new monthly record, up 64.1% year-on-year. The deliveries included 13,728 high-end smart electric vehicles under the NIO brand, 15,246 family smart electric vehicles under the Leda brand, and 5,775 smart electric high-end small cars under the Firefly brand. In the third quarter of 2025, the company delivered 87,071 vehicles, setting a new quarterly high, up 40.8% year-on-year. As of September 30, 2025, the company's cumulative vehicle delivery volume reached 872,785 units.