Zhongtai: High-end growth in the electric vehicle sector is being realized, we suggest paying attention to companies like Ninebot Limited (689009.SH).

Zhongtai's research report stated that the electric vehicle industry is looking at trends from the masses and growth from the high-end to be realized. It is expected that the baseline pressure for the Volkswagen brand will be reduced as early as Q2 2026; high-end brands are expected to grow throughout the year. Currently, the valuation of the electric vehicle sector is relatively low, and it is recommended to pay attention to YADEA (01585), Aima Technology Group (603529.SH), Ninebot Limited (689009.SH). Zhongtai's main points are as follows: The consumption upgrade of two-wheeled vehicles is a process from rural penetration to urban areas, and from durable goods to boutique products. Reviewing the industry development history, from 2005-2013, the two-wheeled vehicle industry expanded rapidly under the advantage of road rights; from 2014-2018, growth slowed down and the structure formed; in 2019-2024, the national standard reform forced old-for-new changes, and the replacement of existing stock drove a high dynamic cycle of about five years. During this period, Aima, following Yadi, also went public, and the industry competition shifted from price competition to profit increase brought by product upgrade. At the same time, brands with internet attributes like Xiaoniu and Ninebot entered from top to bottom; the new national standard was introduced in 24H2, shifting the regulatory focus from channels to brand sources, starting a new round of industry clearance. The growth potential of the high-end two-wheeled vehicle market is significant. At present, the penetration rate of urban electric two-wheeled vehicles has also reached a relatively high level. However, the analysis found that there is a large variance in the holdings between new first-tier cities, with the number of holdings per hundred people fluctuating between single digits to 70+. Assuming that the consumption level and road conditions between new first-tier cities are not significantly different, there is still a large space for high-end two-wheeled vehicles to penetrate. Based on a total penetration rate of 45% for first-tier and new first-tier cities, and assuming a replacement cycle of 5 years, the incremental annual sales volume of the high-end market is estimated to be about 6.6 million. Referring to Ninebot's sales volume in 2024/2025 as approximately 2.6/4.2 million, the market space is still vast. Review of Ninebot's development history - what did Ninebot do right in the high-end market? The analysis believes that Ninebot can establish itself in the high-end market mainly because of its: (1) emphasis on product design, user experience, especially the polishing of intelligent functions; (2) consideration of brand and channel construction: the brand brings premiums, and the channel creates barriers. After forming the market perception of Ninebot electric vehicles being better to ride and the Ninebot brand being easier to sell and more profitable, the company successfully entered a high-growth channel of increasing profits and expanding channels. The new national standard marks the starting point of a new round of reshuffling, with short-term brand differentiation not significant and long-term testing of scale and product strength. For mainstream brands like Volkswagen, after the industry SKU quantity shrinks passively due to the new national standard, leading brands like Yadi and Aima are expected to continue to run through the positive cycle of scale effects; for high-end brands like Ninebot, attention should be paid to their growth potential and product strength interpretation. Risk warning: Risk of data deviation, risk of lower-than-expected sales volume, trade risk, intensified competition risk.