Among the popular Hong Kong stocks, NIO Inc. (HK:9866) stock could offer significant returns for investors, with an expected upside of over 60% in the coming 12 months. In the last year, the company has navigated through the broader EV market challenges, such as competitive pressures and widespread price reductions. Looking ahead, DBS remains bullish on the upcoming launches in 2024 and 2025, which could drive higher market share for the company.
NIO is a prominent Chinese automotive firm, renowned for its premium smart EVs (electric vehicles).
NIO Eyes Mass Market Expansion
Last month, Nio announced its plans to introduce a new mass-market brand this year to boost its sales in China. The new brand, Leo Dao, will target families and will be placed in the lower-priced segment of the market. The first model in this range is expected to launch in the third quarter of 2024, followed by large-scale deliveries in the subsequent quarter. The model will be cheaper than the famous Model Y from Tesla (NASDAQ:TSLA), which was the best-selling car globally in 2023.
DBS’ Bullish Views
Among analysts, DBS holds a highly bullish view of the stock, predicting a solid upside of over 90%. Last month, analyst Rachel Miu from DBS reiterated a Buy rating on the stock. Miu expects slower growth for the company in the first quarter of 2024, along with some sequential margin compression. However, she added that vehicle margins are projected to rebound to the range of 15% to 18% as the production of new models ramps up in the upcoming quarters.
Additionally, Miu is confident that the company’s upcoming launches in 2024 and 2025 will substantially boost production volumes and sales.
What is the Future Price of NIO Stock?
As per the consensus among analysts on TipRanks, 9866 stock has been assigned a Hold rating based on one Buy and four Hold recommendations. The NIO share price target is HK$52.80, which implies an upside of 63% from the current price level.
