Citigroup: Lower target price of Great Wall Motor (02333) to 18.9 Hong Kong dollars, profit last year lower than expected

Citi released a research report stating that it has lowered the target price of Great Wall Motor (02333) from 23.7 Hong Kong dollars to 18.9 Hong Kong dollars and maintained a "buy" rating. Great Wall Motor recently released its performance report, predicting a net profit of 9.912 billion yuan for the last year, a year-on-year decrease of 21.7%, which is lower than investors' expectations. This is mainly due to a 1 percentage point decrease in gross profit margin to 18.5% year-on-year; an increase in expenses related to direct sales model and new product promotion; a delay in receiving tax refunds of about 1 billion yuan for Russian scrap vehicle tax; and the impact of increased year-end bonuses. Great Wall Motor expects its annual revenue for last year to increase by 10.2% year-on-year to 222.79 billion yuan, in line with expectations, with an average selling price of 16.83 million yuan. The management has set a sales target of 1.8 million vehicles for this year, with an overseas sales target of 600,000 vehicles, believing that growth will come from Central and South America, the Middle East, Europe, and right-hand drive markets.