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<Research>Daiwa Elevates GWMOTOR (02333.HK) TP to $20; Surprisingly Strong FY24 Possible
Recommend 6 Positive 20 Negative 4 |
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GWMOTOR (02333.HK)'s strong gross profit may continue in 2HFY24, and overseas expansion will be the main growth driver, according to a research report by Daiwa. The broker raised its target price to $20 and maintained its Buy rating. Daiwa said the company's management expected a strong rebound in sales in June, as May export sales were booked in June. For 2FQ24, management expected the gross margin to be flat or slightly higher QoQ due to unchanged average selling price (ASP) and improved sales matrix. For 2HFY24, GWMOTOR management is optimistic about the strong gross margin outlook due to the increase in the share of sales of higher-margin off-road models in overseas markets, further cost reductions due to sufficient supply of upstream components, and limited participation in the price war in the Mainland, which has enabled it to maintain higher ASPs and stable margins. The broker raised its ASP and gross profit forecasts for FY24-FY26 by 7% - 8% and 0.8 ppts - 1 ppt respectively on the back of strong gross profit contribution from the company's overseas operations. AAStocks Financial News |
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