【行业研究报告】小鹏汽车-Short-term negatives have been priced in

MarketreactspositivelyafterXpeng’sin-line3Q22earnings,assomeinvestors
maybelievetheworstisoverforthecompany.WeareoftheviewthatXpengstill
hasachancetoturnaround,asitsRMB35bnnetcashpositioncouldsupport
Xpengfor2-3yearsuntilXpengfindsoutawinningmodel.Therefore,itsthree
newmodelsnextyearcouldbekeycatalysts.Itisstilldifficulttoquantifythe
improvementaftertheorganizationalstructureandpersonnelchanges,butthe
hardlessonlearntcouldmakemanagementmorefocusedandcostcautious.
3Q22earningsinline.Xpeng’s3Q22earnings,includingrevenue,gross
profitandnetloss,werealllargelyinlinewithourpriorforecasts.Its4Q22
profitandnetloss,werealllargelyinlinewithourpriorforecasts.Its4Q22
sales-volumeguidanceof20,000-21,000unitsslightlymissedourexpectation.
Sufficientcashreservestosupportitspossibleturnaround.Webelieve
Xpeng’scurrentsharepricehasfactoredinthegloomyG9salesoutlook,
althoughmanagementisstillconfidentaboutthemodel.Thekeynowis
whetherXpengcansurviveamidthemoreintensifiedcompetition,inourview.
WebelieveXpengstillhasachancetoturnaroundasitsRMB35bnnetcash
positioncouldatleastsupportXpengfor2-3years,whichmeansXpengcan
stillaffordafewunsuccessfulnewmodelsbeforeitfindsoutawinningmodel.
Itsrecentorganizationalstructureandpersonnelchangescouldmakethe
automakermorefocusedonproductdevelopment.
4Q22EandFY23Eoutlook.Weproject4Q22netlosstonarrowtoRMB
1.7bn,asitmayenjoyforexgains.Infact,Xpeng’snetlossinthefirstnine
monthsof2022wouldbeaboutRMB5.3bn,ifweexcludeforexlosses.We
cutourFY23Esalesvolumeforecastfrom250,000unitsto180,000unitsamid
theG9miss.WeprojectnetlossinFY23EtobeRMB5.8bn,aidedbyitscost
reductionefforts.
Valuation/Keyrisks.WemaintainourBUYratingbutlowerourtargetprice
fromUS$40.00toUS$20.00,basedon2.5x(prior3.2x)ourrevisedFY23E
revenueestimates,alowertargetvaluationthanLiAuto(LIUS,BUY)and
NIO(NIOUS,BUY),givenitsworsesalesmomentumnow.WegiveXpeng
highervaluationthansometraditionalautomakersbecauseitsleading
autonomousdriving(AD)technologyinChinacouldstillprovidethecompany
anedgetochangetheindustrylandscape,shoulditsall-scenarioNGPbe
readyby2024.KeyriskstoourratingandtargetpriceincludeslowerAD
technologyadvancementandafastercatchupfromotherautomakers,lower
salesvolumeand/orgrossmarginthanweexpect,aswellasasectorde-
rating.