Xpeng Motors shares hit new record low in Hong Kong, CICC slashed target price by 30%, UBS doesn’t see significant competitive advantage in G9 model

 

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Shares of Xpeng Motors tumble by as much as nearly 5% to hit a new record low of HK$51.25. The stock tumbled 11.6% in the previous trading day.

Xpeng on Wednesday formally launched its G9 SUV and the car has been slated to begin deliveries in October. The model will be priced from 309,900 yuan ($44,270) to 469,000 yuan and that makes Xpeng’s latest car generally cheaper than new SUV offerings this fall from Nio and Li Auto and Tesla’s Model Y, but significantly higher than the prices of Xpeng’s previous cars.

The correction of Xpeng Motors’s shares has continued as it’s affected by the product cycle shift and the impact of the low season for consumption, said CICC in a note.

Despite the initial improvement in the fundamentals, the short-term market pessimism has not been sufficiently released, the bank said.

CICC maintained the Outperform rating for the stock. Given the limited sales volume during the product iteration period, the 2022-23E revenue for the company were lowered by 7% and 17% to 32.4 billion yuan and 69.2 billion yuan, respectively.

Taking into account the correction in the sector’s valuation, CICC slashed the target price for Xpeng by 30% to HK$80.

Xpeng Motors this week official launched its mid/large SUV model G9 and expected to commence deliveries in late October, with the new vehicle model priced at 300,000 yuan – 350,000 yuan.

Compared to similar vehicle models launched by its peers, Xpeng’s G9 does not enjoy a significant competitive advantage, UBS said in a note.

The bank said that the valuation of Xpeng Motors may face downside risks, if the competition further escalates.

It kept the rating for XPeng at Neutral, with a target price of $34.