20260130-招银国际-正力新能-03677.HK-Higher_earnings_visibility_amid_better_clientmix,_possible_battery_price_hike_5页_740kb

Zenergy (3677 HK) Summary

Core Content

Zenergy is a battery manufacturer listed on the Hong Kong Stock Exchange, and the report provides an analysis of its financial performance and future outlook. The key focus is on its improved earnings visibility, better client mix, and potential battery price hikes, which are expected to positively impact its revenue and gross margin.

Main Points

• Earnings Outlook:

  • Zenergy's FY25E net profit forecast has been revised up by 4% to RMB591mn, driven by a better-than-expected product mix and increased sales volume.
  • The company is projected to see a solid 2H25 earnings, with the potential to beat revenue expectations.
  • FY26E net profit forecast is revised up by 4% to RMB1.36bn, due to a better client mix and possible battery price increases.
  • FY27E net profit is maintained at RMB1.88bn.

• Revenue Growth:

  • Revenue is expected to grow significantly, with a projected YoY growth of 59.8% in FY25E, 77.6% in FY26E, and 42.8% in FY27E.
  • The company's revenue is projected to reach RMB14.6bn in FY26E and RMB20.8bn in FY27E.

• Gross Margin and Operating Margin:

  • Gross margin is projected to increase to 18.1% in 2H25E from 18.0% in 1H25E.
  • Operating margin is expected to widen to 6.0% in 2H25E from 3.8% in 1H25E, and further to 8.1% in FY26E and 9.4% in FY27E.

• Client Mix:

  • GAC Toyota is expected to become the largest revenue contributor, surpassing Leapmotor.
  • The improved product mix from GAC Toyota and SAIC GM is anticipated to drive higher average selling prices and margin expansion.

• Valuation and Target Price:

  • The report maintains a BUY rating with a target price of HK$18.00, based on a 22x FY27E P/E ratio.
  • The valuation is considered justified due to Zenergy's higher profit growth outlook compared to its peers, which have a median FY27E P/E of 15x.

• Key Risks:

  • Lower NEV sales volume from major clients, slower expansion into new models, lower gross margin than expected, and sector de-rating are identified as key risks.

Key Financial Forecasts

Metric	FY25E (RMB mn)	FY26E (RMB mn)	FY27E (RMB mn)
Revenue	8,200	14,564	20,803
Gross Profit	1,478	2,689	3,867
Operating Profit	423	1,174	1,955
Net Profit	591	1,357	1,883
Gross Margin	18.0%	18.5%	18.6%
Operating Margin	5.2%	8.1%	9.4%
Net Margin	7.2%	9.3%	9.1%

Share Performance

• Market Cap: HK$22,606.6 million
• Average 3-month Turnover: HK$20.2 million
• Total Issued Shares: 2,554.4 million
• Shareholding Structure:
  • Ms. Cao Fang and concert parties: 45.4%
  • Others: 54.6%

Price Performance (12-month)

Period	Absolute (%)	Relative (%)
1-month	7.0	0.1
3-month	-1.4	-1.7
6-month	-13.2	-20.5

Analyst Information

• Analysts: Ji SHI, CFA; Wenjing DOU, CFA; Austin Liang
• Contact:
  • Ji SHI: (852)37618728; shiji@cmbi.com.hk
  • Wenjing DOU: (852)69394751; douwenjing@cmbi.com.hk
  • Austin Liang: (852) 3900 0856; austinliang@cmbi.com.hk

Earnings Revision

Metric	CMBIGM Estimate	Consensus	Diff (%)
Revenue	8,200	7,667	7.0%
Gross Profit	1,478	1,375	6.0%
Operating Profit	423	401	5.4%
Net Profit	591	569	3.8%
Gross Margin	18.0%	17.9%	-0.2 ppts
Operating Margin	5.2%	5.2%	-0.1 ppts
Net Margin	7.2%	7.4%	-0.2 ppts

Financial Summary

• Operating Profit: Increased from a loss in 2022A to RMB423mn in FY25E, RMB1,174mn in FY26E, and RMB1,955mn in FY27E.
• Net Profit: Rose from a loss in 2022A to RMB591mn in FY25E, RMB1,357mn in FY26E, and RMB1,883mn in FY27E.
• Gross Margin: Improved from 5.0% in FY23A to 18.0% in FY25E, 18.5% in FY26E, and 18.6% in FY27E.
• Operating Margin: Increased from -11.2% in 1H25 to 6.0% in 2H25E, and is expected to rise to 8.1% in FY26E and 9.4% in FY27E.
• Net Margin: Improved from -7.0% in 1H25 to 7.4% in 2H25E, and is expected to reach 9.3% in FY26E and 9.1% in FY27E.

Valuation Metrics

Metric	FY25E	FY26E	FY27E
P/S (x)	2.5	1.4	1.0
P/E (x)	34.1	15.1	10.9
P/B	2.5	2.2	1.8
P/CFPS	11.8	5.3	4.9

CMBIGM Ratings

• BUY: Stock with potential return of over 15% over the next 12 months.
• HOLD: Stock with potential return of +15% to -10% over the next 12 months.
• SELL: Stock with potential loss of over 10% over the next 12 months.
• NOT RATED: Stock not rated by CMBIGM.
• OUTPERFORM: Industry expected to outperform the relevant broad market benchmark over the next 12 months.
• MARKET-PERFORM: Industry expected to perform in-line with the relevant broad market benchmark.
• UNDERPERFORM: Industry expected to underperform the relevant broad market benchmark.

Disclosures

• The report is not investment advice and should not be relied upon for making investment decisions.
• CMBIGM has no responsibility for any loss, damage, or expense incurred from relying on the report.
• The report may be subject to change and is not guaranteed to be accurate or complete.
• CMBIGM may have investment banking relationships with the companies mentioned in the report, which could lead to conflicts of interest.
• The report is for the use of intended recipients only and may not be reproduced, reprinted, sold, redistributed, or published without prior written consent.

Legal and Regulatory Information

• The report is distributed in accordance with applicable laws and regulations in the regions it is sent to, including the United Kingdom, the United States, and Singapore.
• In the United States, the report is intended for "major US institutional investors" only and is not subject to U.S. rules on research reports.
• In Singapore, the report is distributed by CMBISG, an Exempt Financial Adviser, and is subject to the Financial Advisers Act.
• In the United Kingdom, the report is provided only to persons falling within specific legal categories under the Financial Services and Markets Act.