---
title: "CICC: Sector valuations have declined, reducing Zhongsheng's target price by 29% to HKD 18"
description: "CICC released a report stating that ZHONGSHENG HLDG's net profit last year fell by 36% year-on-year to 3.21 billion yuan, in line with expectations, maintaining an \"outperforming the industry\" rating."
type: "news"
locale: "en"
url: "https://longbridge.com/en/news/233847100.md"
published_at: "2025-03-31T08:52:02.000Z"
---

# CICC: Sector valuations have declined, reducing Zhongsheng's target price by 29% to HKD 18

> CICC released a report stating that ZHONGSHENG HLDG's net profit last year fell by 36% year-on-year to 3.21 billion yuan, in line with expectations, maintaining an "outperforming the industry" rating. Due to the decline in sector valuations, the target price was lowered by 28.9% to HKD 18. The profitability of new car sales was affected by terminal discounts, while after-sales business profitability remained stable. The company is expanding luxury brands on the Huawei platform, which is expected to increase its market share in the new energy luxury vehicle segment. The dividend payout ratio is expected to rise to 46.7% in 2024, promising greater returns for shareholders. The profit forecast for 2025 remains unchanged, and a net profit forecast of 4.97 billion yuan for 2026 has been introduced for the first time

CICC published a report indicating that ZHONGSHENG HLDG's net profit last year fell by 36% year-on-year to 3.21 billion yuan, in line with the bank's expectations. The rating is maintained at "outperform the industry," but due to the decline in sector valuations, the target price is lowered by 28.9% to HKD 18. The report states that new car sales profitability is under pressure due to terminal discounts, while the after-sales business contributes stable profits. The company has established 37 Aito brand stores and is expanding the HarmonyOS intelligent travel ecosystem based on the Huawei platform, which is expected to supplement the company's luxury brand matrix and further enhance its market share in the new energy luxury vehicle market. The company has consistently maintained dividend payments, with the dividend payout ratio expected to increase to 46.7% in 2024. As profits gradually improve, greater shareholder returns are anticipated. CICC maintains its profit forecast for ZHONGSHENG HLDG for 2025 and introduces a net profit forecast of 4.97 billion yuan for 2026 for the first time. The bank lowers the target price to HKD 18, equivalent to forecasted price-to-earnings ratios of 10.7 and 8 times for this year and next, respectively, while maintaining the "outperform the industry" rating

### Related Stocks

- [00881.HK - ZHONGSHENG HLDG](https://longbridge.com/en/quote/00881.HK.md)
- [HUAWEI.NA - Huawei](https://longbridge.com/en/quote/HUAWEI.NA.md)

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> **Disclaimer**: This article is for reference only and does not constitute any investment advice.
