CICC: Raises target price of NIO-SW (09866) to 45 Hong Kong dollars and maintains "outperform" rating

CICC released a research report stating that the current NIO-SW (09866) corresponds to 0.8x P/S for 2025, maintaining 2025-26 non-GAAP net profit and outperforming the industry rating. Considering the company's good product cycle, the target price was raised by 10% to HK$45, corresponding to 1.1x P/S for 2025, with a 29% upside potential from the current stock price. On July 31, NIO's sub-brand Leosway Automobile held a product launch event for the Leosway L90, offering two seating layouts for 6 and 7 seats, with a starting price of 265,800 yuan for the whole vehicle purchase using the BaaS battery rental method, with a starting price of 179,800 yuan. The main points of view of CICC are as follows: The pricing of the L90 exceeds market expectations, and the comprehensive product strength leads the industry. In terms of delivery rhythm, the company plans to officially start deliveries on August 1. The company first released the product and then officially listed it. By referring to the number of pre-sale small orders, the company gave more time for the company to have sufficient production reserves in advance. The bank expects that deliveries in September are expected to exceed tens of thousands of vehicles, better grasping the heat of the first wave of word-of-mouth for the new product launch. In terms of product highlights, the bank believes that the L90 showcases competitiveness in terms of space, energy consumption, and safety in multiple dimensions. Specifically, in terms of space, which is a core need for users of large three-row SUVs, the L90 achieves space optimization through 36 technical innovations such as lightweighting, high integration, and three-electric capabilities. In terms of safety, with the concept of "liberating energy and reducing accidents," the L90 is equipped with 45 active and intelligent safety assistance functions, including standard end-to-end architecture AEB. Based on the company's accumulation in data and algorithms, the bank believes that the safety of the L90 leads the industry. Expected to usher in a new product cycle, looking forward to gradually realizing the effects of reform. The company plans to launch the Leosway L80 and the all-new ES8 in the second half of the year, and is optimistic about the company's deliveries gradually surpassing 30-40 thousand vehicles per month in the 3rd and 4th quarters. In terms of automotive gross profit rates, although the pricing of the new models of Leosway is more cost-effective, considering that it shares the NIO NT3.0 platform, technology procurement drives cost reduction. Along with the overall sales growth of the company, the bank expects the company to gradually realize a 15%+ gross margin guidance for the NIO brand and a 10%+ gross margin guidance for the Leosway brand. With optimization on the expense side, the bank expects the company to achieve positive profits in Q4 2025 and positive free cash flow guidance in Q3-4. Smooth progress in intelligent driving, world model performs well. The company continues to invest in the field of intelligent driving. On May 30th, NIO's world model NWM's first version was officially launched. The company insists on safety first, achieving a comprehensive upgrade of technology capabilities and user experience in four major scenes of active safety, high-speed navigation, urban navigation, and intelligent parking, fully demonstrating the technical characteristics of the model with a stable base and high ceiling. In addition, thanks to the early planning and embedding of intelligent hardware, the company has provided enough space for the update iteration of the intelligent driving technology architecture, allowing owners of different versions to enjoy the latest technological achievements.