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[I-bank focus]BofAML ups numbers for Geely post January data
[ET Net News Agency, 8 February 2018] Geely Automobile (00175) reported January sales
volume of 155k units, up by 51% YoY and about 10% of its group 2018 target (1.58mn units).
Lynk & Co also posted sales of 6,173 units, led by the Lynk & Co 01. BofA Merrill Lynch
said Geely's volume sales growth momentum remains strong amid lackluster China passenger
vehicle (PV) growth.
The research house raised its 2017/18 earnings forecasts by 8.5%/10.4% on 2017
preliminary volume sales and earnings, and a potential ASP hike, driven by new product
launches. It reiterated its "buy" rating on Geely, with a target price of HK$36.
BofAML expects Geely's ASP to grow by 5% YoY in 2018, mainly on better mix (more
mid-to-high end). Hence, it expects Geely's GPM to grow by 2.4/0.8ppt in 2017/18, aided by
efficiency improvements and ASP hikes. (KL)