Bank of America Securities: Initiates "Buy" rating on CHERY AUTO with a target price of HKD 45

Bank of America Securities released a research report stating that it has initiated coverage on CHERY AUTO with a "Buy" rating and a target price of HKD 45. The firm expects the company's adjusted net profit compound annual growth rate to reach 17% from 2025 to 2027, driven by an increase in electric vehicle sales penetration and a higher contribution from high-end model sales, which will improve profit margins. Additionally, the diversification of overseas business markets and the increased contribution of electric vehicles, along with the upgrade of vehicle intelligence to strengthen brand positioning, lead the firm to anticipate that the contribution of CHERY AUTO's electric vehicles to sales will rise from 31% in 2025 to 48% in 2027, with the gross margin of the electric vehicle business increasing from 0.4% in 2024 to 10% in 2027