<div id="readability-page-1"><div><p>Citi issued a research report noting that, according to the latest data from the China Passenger Car Association, SERES (09927.HK)<span> </span><span> -2.450 (-4.167%)  </span> <span> Short selling $7.78M; Ratio 6.649%  </span>  and Huawei-backed new energy vehicle brand AITO recorded May sales of 30,300 units, down 17% YoY and up 1% MoM. Brand market share decreased by 0.7 ppts YoY to 2.2%. Cumulative sales for the first five months of 1Q26 reached 130,000 units, up 4% YoY. In light of the tepid sales performance, the bank lowered its sales forecasts for SERES for 2026 and 2027 by 15% to 16% to 468,000 and 528,000 units, respectively. Revenue forecasts were also cut by 15% to 17% to RMB152 billion and RMB169 billion, respectively.</p><p>Due to weakening economies of scale and raw material cost inflation, Citi also reduced its gross margin forecasts for 2026 and 2027 by 2.4 to 3.2 ppts to 26.8% and 25.7%, respectively. Accordingly, net profit forecasts for 2026 and 2027 were slashed by 49% to 52% to RMB5.113 billion and RMB6.556 billion, respectively.</p><p>Citi expects SERES to continue facing sales pressure amid intense competition from numerous new large SUV models launching this year. Given the relatively wide discount of its H shares, the bank maintained a Neutral rating on its H shares and lowered the TP from HKD98.9 to HKD63.7. (gc/da)(HK stocks quote is delayed for at least 15 mins.Short Selling Data as at 2026-06-10 16:25.)</p></div></div>

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<p>Citi downgraded SERES' target price to HKD63.7 from HKD98.9, maintaining a Neutral rating due to tepid sales and intense competition. Following a 17% YoY drop in May sales for the Huawei-backed AITO brand, Citi slashed 2026-2027 forecasts for sales volume, revenue, gross margin, and net profit by up to 52%. The bank cited weakening economies of scale and rising raw material costs as key factors impacting profitability.</p>

Citi Cuts SERES TP to HKD63.7, Rates Neutral on Tepid Sales