Investment Summary

Revenue Growth Amid Transformation While Profits Face Pressure

According to the 2025 annual result forecast of Great Wall Motor, the Company reported total revenue of RMB222.79 billion in the full year (RMB, the same hereafter), up 10.2% yoy. Net profit attributable to shareholders was RMB9.912 billion, down 21.7% yoy. Non-GAAP net profit attributable to the parent company fell 36.5% yoy to RMB6.158 billion.

The decline in profit was mainly due to the Company accelerating the build-out of a new channel model that connects directly with users, while also increasing investment in the launch and promotion of new models and technologies as well as brand enhancement, which reduced the Company's profitability.

Looking at the fourth quarter alone, the Company recorded net profit attributable to the parent company of RMB1.28 billion, down 43.5% yoy and down 44.4% qoq, mainly due to one-time year-end bonus accruals and delayed tax refunds on scrapped vehicles. Excluding these factors, the Company's operations remained stable.

New Energy Vehicles and Overseas Markets Drive Sales Growth, While Product Mix Optimisation Lifts Per-Vehicle Revenue

Sales volume of Great Wall Motor reached a record high of 1,324 thousand units in 2025, up 7.3% yoy, driven by the dual engines of new energy vehicles and overseas markets. Among them, sales of new energy vehicles reached 404 thousand units, up 25.4% yoy, with the proportion of NEVs expanding by 4.4 percentage points to 30.5%. Overseas sales reached 506 thousand units, up 11.7% yoy, with the overseas sales ratio expanding by 1.5 percentage points to 38.2%.

Among the Company's sub-brands, Haval, WEY, Tank, Ora, and pickup recorded sales volume of 759 thousand, 102 thousand, 233 thousand, 48 thousand, and 182 thousand units respectively, up 7.41%/+86.29%/+0.74%/-23.68%/+2.57% yoy respectively. The high-end brand Tank remained stable, while WEY grew significantly, with WEY Alpine achieving over 10,000 monthly deliveries for three consecutive months. With the continuous optimisation of the product sales structure, the average selling price per vehicle rose steadily. In 2025, the Company's ASP rose up 2.7% yoy, or RMB4,400, to RMB168.3 thousand, reflecting further strengthening of the brand.

Platform Opens a New Product Cycle

In January 2026, Great Wall Motor launched the world's first native AI full-powertrain platform ¡V GWM One. The platform is compatible with five powertrain types: PHEV, HEV, EV, FCEV, and ICE, covering seven vehicle categories including sedan, SUV, pickup, MPV, and sports car. It is equipped with self-developed 6C cells and a 900V architecture. The first flagship six-seat model based on the GWM One platform, the WEY V9X, is set to debut soon.

Deepening Globalisation Strategy to Support Long-Term Growth

The Company has set a sales volume target of 1.8 million units for 2026, including 600 thousand units from overseas markets, equivalent to an increase of 18.6%. We expect the incremental volume to come mainly from the continued roll-out of overseas localised production capacity and the accelerated expansion of overseas dealer networks (currently deployed in 1,500 locations). The Company has established three complete vehicle production bases in Thailand, Brazil, and Russia, and operates multiple KD factories in Pakistan, Vietnam, Tunisia, and other locations.

Investment Thesis

The Company has set resolute strategic objectives and clear steps for new energy and high-end-oriented transformation. The roll-out of a series of new models and the deepening of overseas market deployment in this strong product cycle, along with the scale effect emerging after channel improvements, are expected to support the Company's continued growth momentum.

Considering latest financial forecast, we revised our target price to HK$17, equivalent to 13.2/9.5/7.6x P/E and 1.5/1.3/1.1x P/B in 2025/2026/2027. We maintain our Buy rating. (Closing price as at 10 March)

GWM¡¦s P/E trend

Source: Wind, Phillip Securities Hong Kong Research

Risks

New vehicle sales fall short of expectations
The SUV market dramatically worsens
The progress of new energy vehicle/Pickup is poorer than expectations

Financial Data

(Closing price as at 10 March)

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