The analyst rating from JPMorgan on XPENG-W (09868.HK) is based on several positive factors:
1. Earnings Performance: XPENG-W's non-GAAP full-year earnings for FY25 exceeded both JPMorgan's and the market's expectations by 50-70%, indicating strong financial performance.
2. Quarterly Profitability: The company achieved quarterly profitability for the first time in 4Q25, alongside a narrowed annual net loss, which reflects improved operational efficiency.
3. Sales and Product Mix: The positive results were attributed to increased car sales and an optimized product mix, suggesting effective business strategies.
4. Diversified Revenue Streams: Contributions from non-automotive businesses, such as after-sales services and automotive finance, have bolstered overall performance.
5. Future Outlook: JPMorgan views XPENG-W as a core recovery trade in the Chinese automotive industry, with expectations for attractive buying opportunities in 2026 due to leading technology deployment, a strong new car model cycle, continuous profitability improvement, and robust overseas growth.
6. Target Price: JPMorgan has set a target price of HKD135 for XPENG-W, reflecting confidence in the stock's potential for further re-rating.
Overall, these factors led JPMorgan to maintain an Overweight rating on XPENG-W.
