[ET Net News Agency, 3 July 2020] Citi Research raised its target price for BYD Company
(01211) to HK$109.2 from HK$92.2 and maintained its "buy" rating.
The research house said the target price hike factored in potential new NEV battery
business (selling to external customers). Citi estimated BEVs (battery electric vehicle)
equipped with BYD's bladed batteries allow automakers to earn 10ppt higher GPM than what
NCM-powered BEVs do.
For car users, owning a bladed battery-powered BEV is Rmb3-7.5k cheaper than owing an
NCM one. Citi estimated its cost and scale advantages would allow BYD to tap into the
global battery market and acquire a 4.5% market share in key regions (the US, EU, and
China) by 2021 and expand to 7% by 2025.
Citi forecast the combined three key regions' demand for NEV battery at 93Gwh in 2020,
and 520/1,046Gwh in 2025/30. (KL)