Nomura has released a deep report on BYD Company Limited, forecasting that hybrid cars will surpass pure electric cars as the main driver of growth, with a target price raised to 312 yuan, and overseas market revenue expected to account for more than 20%.
Recently, Nomura released its latest in-depth report, which clearly stated that plug-in hybrid electric vehicles (PHEV) will perform better than battery electric vehicles (BEV) in 2024 and become the main driver of BYD's next growth. In addition, the report predicts that BYD's overseas market revenue will account for more than 20% this year. Driven by this series of positive factors, Nomura has raised its target price from 276 yuan to 312 yuan and reiterated its "buy" rating.$BYD COMPANY (01211.HK)$In-depth report clearly states that plug-in hybrid electric vehicles (PHEV) will outperform battery electric vehicles (BEV) and become the main driving force for BYD's next growth in 2024.
In addition, the report predicts that BYD's overseas market revenue ratio will exceed 20% this year. Driven by this series of positive factors, Nomura has raised its target price from RMB 276 to RMB 312 and reiterated its 'buy' rating.$BYD Company Limited (002594.SZ)$Nomura has raised its target price for BYD from RMB 276 to RMB 312 and reiterated its 'buy' rating.
The hybrid will become a new breakthrough point.
The report mentioned that because BYD started to lower prices at the end of February this year and upgraded its latest DM-i 5.0 hybrid platform, BYD has performed strongly in the past few months, and its order volume has also increased recently.
In the domestic market, especially in the case of joint venture car companies' difficult competition, Nomura expects that BYD will continue to maintain its leading position in the Chinese market in 2024 and is expected to have a wholesale shipment volume of over 3.7 million for the whole year.
In terms of specific models, the report is bullish on the Qin L, Yuan 06 and upcoming Song L DM-i, Tang L, and Han L models, and predicts that the sales growth of these PHEV models will be faster than BEV. Nomura believes that BYD's hybrid technology and product layout give it significant advantages in market competition.
Huge potential for overseas expansion.
Although the European Union recently raised tariffs, the report believes that this will have a limited impact on BYD's short-term shipments or profit margins.
With BYD's gradually improving production capacity in Thailand, Brazil and Hungary, as well as plans to establish a second factory in Europe, the company's further penetration prospects in the global market are promising.
Nomura expects that in 2024, 13% of BYD's passenger car shipments and 23% of revenue will come from overseas markets.
Target price raised to ¥312.
Against the backdrop of challenges facing the global new energy vehicle market, BYD has shown strong momentum in its development based on its advantages in technology, products, and market layout.
Nomura raised BYD's target price to ¥312, implying a 2024 and 2025 P/E ratio of 26 times and 21 times, respectively, while the current stock price corresponds to a 2024 P/E ratio of 21 times.
Nomura believes that BYD not only occupies a dominant position in the Chinese market, but its leading hybrid technology and active expansion in the international market make it have strong competitiveness globally.
With multiple new car models based on the DM-i 5.0 platform about to be launched, BYD is expected to continue to perform strongly in the Chinese market in the next few months, especially in hybrid electric vehicle sales.
At the same time, further penetration and expansion plans in overseas market will help the company establish a strong position in the global market.
Editor/Somer