Zhitong Financial APP learned that car dealers led the decline, with East Motor (01268) down 7.12% to HK $9.26, Zhongsheng Group (00881) down 3.4% to HK $27, Guanghui Baoxin (01293) down 3.17% to HK $0.305 and Yongda Motor (03669) down 1.65% to HK $3.58.
According to a research report released by Morgan Stanley, due to a significant deterioration in profit margins of new cars, a slowdown in after-sales business performance, and a distant recovery in demand for high-end fuel vehicles, car dealers such as Zhongsheng Group, East America and Yongda Motor are expected to record year-on-year falls in profits in the first half of this year. It is expected that further supply cuts may be needed in the second half to stabilize prices, and will reveal more kickbacks to subsidize loss-making electric vehicle sales.
The bank also expects that although dealers' second-hand auto transactions grew strongly in the first half of the year, their contribution to profitability is still limited, and the three dealers' profit forecasts for the next few years are downgraded to reflect the decline in new car sales and profit margins as a result of increased price competition. rated as "overweight".