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<Research>CMSI: CN Auto Sector Sees Significant Recovery in 2Q w/ Focus on Structural Excavation
Recommend 59 Positive 77 Negative 23 |
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The darkest period for China's auto industry has passed, with a significant QoQ recovery in 2Q and a slower industry price war, according to CMSI's research report. CMSI suggested that investment strategy should shift from stock game to structural excavation, and favored premiumization, overseas growth and incremental opportunities from HEV breakthroughs. Among automakers, the broker's top pick is GEELY AUTO (00175.HK) on its huge earnings elasticity from premiumization, which also supports sales and brand strength in the mid- to low-end segments. Moreover, CMSI also preferred BYD COMPANY (01211.HK), XPENG-W (09868.HK) and LEAPMOTOR (09863.HK). Among auto parts stocks, CMSI believed that MINTH GROUP (00425.HK) continues to advance new businesses such as humanoid robotics and liquid cooling, and investors should monitor 2Q orders and project implementation progress, which could provide mid- to long-term growth flexibility. For FUYAO GLASS (03606.HK), the rationale behind its rising average selling prices continued to materialize, with strengthened global footprint and resilient profitability. The broker was also positive on WEICHAI POWER (02338.HK) in expanding into the new AIDC segment. Auto-translated by AI AASTOCKS Financial News |
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