Huatai Securities is optimistic about YADEA's continued consolidation of its leading advantage in the two-wheeled vehicle sector, maintaining a "Buy" rating

Huatai Securities maintains a "Buy" rating on YADEA (01585.HK), with a target price of 18.63 yuan. The company expects a net profit of no less than 2.9 billion yuan in 2025, representing a year-on-year growth of over 128%, primarily driven by the increase in electric two-wheeler sales and product structure optimization.

The report indicates that YADEA's two-wheeler sales are expected to exceed 16.2 million units in 2025, with net profit per unit increasing by over 80% year-on-year to over 180 yuan. As the proportion of high-margin products increases and economies of scale become evident, net profit per unit is expected to continue to rise in 2026. Meanwhile, the company is focusing on the mid-to-high-end market with its "Crown" and "Modern" brands and is increasing the proportion of self-supplied batteries to further enhance profitability.

In terms of overseas markets, the firm notes that YADEA will benefit from the fuel motorcycle restrictions in Southeast Asia (such as the ban on motorcycles in Hanoi, Vietnam in 2026), which will accelerate the replacement process of electric motorcycles and is expected to enhance local market share. With the release of overseas production capacity and the improvement of the channel network, the company is expected to continue benefiting from the "oil-to-electric" trend, opening up a second growth curve.

The firm is optimistic about YADEA's continued consolidation of its leading position in the two-wheeler market but has lowered its net profit forecast for last year to 2.94 billion yuan, mainly considering the impact of the transition between old and new national standards on sales in the fourth quarter of last year, thus adjusting its sales assumptions. It also maintains the company's net profit forecasts for this year and next year at 3.51 billion and 3.83 billion yuan, respectively, with a compound annual growth rate of 44.4%, corresponding to earnings per share of 0.99, 1.18, and 1.29 yuan