2Q22: Core Net Profit Down 49.5% yoy, In Line With Estimates; Cut Target Price To HK$18.00
GWM’s 2Q22 core net profit came in as expected at Rmb756m (-49.5% yoy/-42% qoq), vs its guidance of Rmb497m-997m. Looking ahead, we expect earnings to recover starting from 3Q22, along with the restoration of supply chain after the lifting of lockdowns and debuts of new models in 2H22. GWM plans to lift EV share in the sales mix of Haval to 80% by 2025. We cut 2023-24 net profit forecasts by 12% per year to factor in lower blended margins. Maintain BUY. Cut target price to HK$18.00.