China Merchants Securities released a research report stating that Ideal Automobile-W (02015)'s net profit forecast for the 2024-2026 fiscal year was lowered by 27%/35%/30%, respectively, reflecting the impact of the company's market strategy adjustments on sales. The Company's projected compound annual growth rate of non-GAAP net profit for the 2023-2026 fiscal year was 37%, and the target price was lowered from HK$260 to HK$191. The pessimistic expectations of the company's strategic adjustments have been released. Focus on the launch of the company's blockbuster model L6 before and after the Beijing Auto Show in April. The L6 is the pillar of the company's sales growth this year.
According to the report, the company delivered 29,000 new vehicles in March, up 39% and 43% year over year, respectively. The year-on-year increase was affected by the L series entering a steady sales range and the contribution of new models to sales. The month-on-month increase was supported by seasonal market recovery and MEGA's contribution to sales volume. Ideal Auto sold a total of 80,000 units in the first quarter, up 53% year on year, better than the company's previous guidance of 76,000 to 78,000 units, showing a recovery in delivery capacity after the company readjusted its market strategy in late March.