Chinese automobile giant BYD Co. Ltd (HK:1211) has won the favor of American research firm Goldman Sachs analyst Tina Hou, who is upbeat about the stock following the recently held Intelligent Experience Day” event in Shenzhen. The analyst has a Buy rating on 1211 stock and has assigned the highest price target to date of HK$346 (74.4% upside) on the new energy vehicle (NEV) maker.
Don't Miss our Black Friday Offers:
- Unlock your investing potential with TipRanks Premium - Now At 40% OFF!
- Make smarter investments with weekly expert stock picks from the Smart Investor Newsletter
Bullish Stance
Hou is impressed with BYD’s leading presence in the NEV markets, both at home and internationally. BYD manufactures mass-market and luxury autos, which has helped it gain a larger market share. Moreover, BYD’s big dreams for the international markets could act as a major growth driver going forward. Furthermore, BYD boasts technological innovations, including manufacturing its in-house batteries.
Based on these factors, Hou expects BYD’s total auto sales volume to reach 7.8 million units in 2030 from the current estimated 3.1 million units in 2023. This means that BYD could capture roughly 33% of China’s NEV demand. Overall, Hou is encouraged by BYD’s solid sales volume growth, China’s new supportive policies that will help boost the NEV industry, export ramp-up plans, and robust quarterly performance.
Here are Some of BYD’s Updates from the Event
BYD is set to begin the mass production of premium RMB300k+ models with the inbuilt L2+ ADAS technology in Q3 FY24. Plus, by Q4 FY24, BYD will start offering the L2+ ADAS technology optionally in models ranging between RMB200 to 300K prices.
BYD management plans to achieve a volume target of 3.9 to 4 million units this year. Also, premium brands are expected to make up roughly 20% of BYD’s total revenue in 2024, growing from 12% in 2023. Furthermore, for export markets, BYD aims to set up manufacturing facilities in Europe to overcome the restrictions on imports from China.
BYD sees 2024 as the year of launching new-generation technologies, enhancing its fast-charging technologies, and growing its battery business. BYD has already outpaced rival Tesla (NASDAQ:TSLA) as the global leader in EV sales in Q4 2023. Plus, BYD recently announced investing 100 billion yuan to boost the features of its EV models.
What is the Future of BYD Stock?
On TipRanks, 1211 stock commands a Strong Buy consensus rating, backed by four Buys and one Hold rating. The BYD Co. Ltd. share price target of HK$283.11 implies 42% upside potential from current levels.
Ending Thoughts
BYD is poised for solid momentum going forward with its ambitious export plans and new model launches. Analysts’ conviction in the stock’s trajectory is based on reasonable assumptions and could be followed while considering investing in the stock.
