＜Research＞UBS Downgrades GAC GROUP (02238.HK) to Neutral, Chops TP to $3.2

　　UBS released a research report estimating that the penetration rate of EV in China will exceed 50% by 2025-2026.

　　The sales volume of its JVs, naming GAC Toyota/ GAC Honda, declined by 27%/ 24% YoY each in 5M24, UBS said. Although GAC Aion is a pioneer in the field of electrification, UBS believed that GAC Aion is being overtaken by its competitors, resulting in a 39% YoY drop in deliveries in 5M24.

　　UBS lowered FY2024-FY2026 earnings forecasts for GAC GROUP (02238.HK) -0.040 (-1.347%) Short selling $16.87M; Ratio 42.272% by 50-70% to RMB2.7 billion/ RMB2.6 billion/ RMB2.1 billion respectively, lower than the market consensus of RMB5.2 billion to RMB5.4 billion, believing that the market overlooks the huge earnings downside risk.

　　UBS downgraded GAC GROUP from Buy to Neutral, and chopped its target price from $6 to $3.2.

　　(HK stocks quote is delayed for at least 15 mins.Short Selling Data as at 2024-06-25 16:25.)