According to a research report from Orient Securities Company Limited (SH: 600958), the firm forecasts that Geely Auto (HK: 00175) will record net profits attributable to shareholders of RMB 20.476 billion, RMB 25.942 billion, and RMB 30.809 billion for 2026, 2027, and 2028, respectively. The report maintains a target price of RMB 20.79 and HKD 24.23 (at an exchange rate of HKD 1 = RMB 0.8580), based on an average PE valuation of 11x for comparable companies in 2026, and reiterates its Buy rating. The firm believes that the company's September sales grew both year-on-year and month-on-month, and that Geely Auto is accelerating the construction of its energy replenishment system, strengthening model competitiveness and its brand moat. The overseas launch of the Zeekr 9X is a critical step, and premium overseas expansion is expected to unlock new space for profit growth. The main points from Orient Securities Company Limited are as follows:

September sales grew both year-on-year and month-on-month

In September, Geely Auto total sales reached 292,200 units, up 7.0% year-on-year and up 8.1% month-on-month; cumulative sales for January to September totaled 2.2355 million units, up 3.0% year-on-year. According to data from the China Passenger Car Association, national passenger vehicle wholesale from September 1 to 27 reached 1.474 million units, down 30% year-on-year and down 12% month-on-month. Due to the high base from last September when a rush of purchases occurred before subsidy suspensions in some regions, combined with the staggered Mid-Autumn holiday and other factors that weighed on industry sales year-on-year, it is expected that Geely Auto September sales growth will outperform the overall industry.

Multiple Galaxy models launched successively; AI smart charging plus NIO partnership strengthens energy replenishment system

In September, the Geely brand sold 236,500 units, up 6.5% year-on-year and up 9.4% month-on-month; cumulative sales for January to September reached 1.751 million units. In September, Geely Auto new energy vehicle sales reached 190,900 units, up 15.5% year-on-year and up 8.5% month-on-month, with a new energy penetration rate of 65.3%; cumulative new energy sales for January to September reached 1.3264 million units, up 13.6% year-on-year. In September, Geely Galaxy sales reached 130,500 units, a new high for the year, up 8% year-on-year and up 10% month-on-month. New models under the Galaxy brand are being launched successively: the Galaxy TT held its global launch on September 10, the Galaxy E5 was launched on September 23, and the Galaxy Warship 700 has opened pre-sales, with orders exceeding 43,900 units within one hour and an expected launch on October 10. On September 23, Geely Smart Charging was officially released, featuring a single-gun peak charging power of up to 2.2 MW and active charging management through the Xingrui PowerMind energy brain. The company simultaneously unveiled a new generation of Shen Dun Golden Brick ultra-short blade batteries, with 6C and 12C versions equipped on the Galaxy E5 and Lynk 10 models, respectively. Geely aims to build more than 22,000 charging stations and 100,000 charging guns by the end of 2027, including more than 15,000 smart charging stations, achieving coverage in every county nationwide. At the group level, Geely Holding reached a strategic partnership with NIO, investing 100% equity of Yiyi Interconnect and RMB 640 million in cash into NIO Energy for a 30% stake; NIO will also invest in Geely Holding's Haohan Energy for a 10% stake. The two parties will jointly build unified consumer-facing battery swap technology and standards, with Geely Holding developing models and NIO Energy providing services. The firm believes Geely Auto is accelerating the construction of its energy replenishment system, strengthening model competitiveness and its brand moat.

Zeekr brand continues strong sales; premium overseas expansion continues

The Zeekr brand sold 37,200 units in September, up 103.8% year-on-year and up 0.6% month-on-month; cumulative sales for January to September reached 288,400 units, up 100.8% year-on-year. The Lynk & Co brand sold 18,500 units in September, up 8.6% month-on-month, with cumulative sales for January to September reaching 196,100 units. On September 10, Geely reached an agreement with Volvo, under which Volvo will serve as the exclusive distributor for Lynk & Co in Europe starting January 2027, fully responsible for local commercial and brand operations. It is expected that cross-brand resource sharing within the group will help improve Lynk & Co operational efficiency. On September 22, the Zeekr 9X was officially launched in the UAE, and will subsequently expand to core markets including the Middle East, Central Asia, Europe, and Latin America. The Zeekr 9X is priced at over RMB 800,000 in the UAE and nearly RMB 1 million in Europe. The firm believes the overseas launch of the Zeekr 9X is a critical step, as it directly enters the core overseas luxury car market with a selling price far higher than in China. If the Zeekr 9X succeeds in the UAE, other overseas markets and the Zeekr 8X model can be expected to follow. Premium overseas expansion is expected to unlock new space for the company's profit growth.

Risk warnings

Risks include sales of Geely, Lynk & Co, and Zeekr brands falling below expectations, and cost control falling short of expectations.