Company Coverage
BYD Company (1211 HK): 2Q26: Core Earnings Surge 141% yoy On Margin Beat; Raise Target Price To HK$150.00
BUY (Maintained)
Current price:
Target price:
Upside:
Previous TP :
HK$91.95
HK$150.00
+63.1%
HK$135.00
Analyst
Highlights
2Q26 adjusted net profit beat estimates at Rmb8,226m (+51.5% yoy/+98.3% qoq). Stripping out forex gain/(loss), core net profit surged 141% yoy and 80% qoq to Rmb10.6b in 2Q26. The earnings beat stemmed from margins.
BYD’s FCF resumed positive at Rmb11.855b in 2Q26, as operating cash flow surged 48.6% yoy and capex plummeted 47.6%.
Raise our 2026-28 net profit forecasts by 5%/14%/15% on higher margins. Maintain BUY and lift target price from HK$135.00 to HK$150.00.
Analysis
Coe earnings surged 141% yoy in 2Q26 on margin beat. 2Q26 results beat expectations with GAAP net profit of Rmb8,241m (+29.7% yoy/+101.8% qoq) and adjusted net profit of Rmb8,226m (+51.5% yoy/+98.3% qoq). Forex gain/(loss) swung to a net loss of Rmb4,703m in 1H26 from a net gain of Rmb3,160m in 1H25, dragging earnings. Stripping out forex gain (loss), core net profit surged 141% yoy and 80% qoq to Rmb10.6b in 2Q26, and grew 50% yoy to Rmb16.3b, beating estimates. The beat stemmed from upbeat margins, due to the increased share of exports in total sales.
Revenue in line. Revenue dipped 3.2% yoy but grew 29.5% qoq to Rmb194.59b in 2Q26, and fell 7.1% yoy to Rmb344.815b in 1H26, in line with estimates. In 1H26, the auto segment’s revenue dropped 9% yoy to Rmb275.07b, while the electronics segment’s revenue edged up 1% yoy to Rmb69.375b.
Highlights
2Q26 adjusted net profit beat estimates at Rmb8,226m (+51.5% yoy/+98.3% qoq). Stripping out forex gain/(loss), core net profit surged 141% yoy and 80% qoq to Rmb10.6b in 2Q26. The earnings beat stemmed from margins.
BYD’s FCF resumed positive at Rmb11.855b in 2Q26, as operating cash flow surged 48.6% yoy and capex plummeted 47.6%.
Raise our 2026-28 net profit forecasts by 5%/14%/15% on higher margins. Maintain BUY and lift target price from HK$135.00 to HK$150.00.
Analysis
Coe earnings surged 141% yoy in 2Q26 on margin beat. 2Q26 results beat expectations with GAAP net profit of Rmb8,241m (+29.7% yoy/+101.8% qoq) and adjusted net profit of Rmb8,226m (+51.5% yoy/+98.3% qoq). Forex gain/(loss) swung to a net loss of Rmb4,703m in 1H26 from a net gain of Rmb3,160m in 1H25, dragging earnings. Stripping out forex gain (loss), core net profit surged 141% yoy and 80% qoq to Rmb10.6b in 2Q26, and grew 50% yoy to Rmb16.3b, beating estimates. The beat stemmed from upbeat margins, due to the increased share of exports in total sales.
Revenue in line. Revenue dipped 3.2% yoy but grew 29.5% qoq to Rmb194.59b in 2Q26, and fell 7.1% yoy to Rmb344.815b in 1H26, in line with estimates. In 1H26, the auto segment’s revenue dropped 9% yoy to Rmb275.07b, while the electronics segment’s revenue edged up 1% yoy to Rmb69.375b.
BUY (Maintained)
Current price:
Target price:
Upside:
Previous TP :
HK$91.95
HK$150.00
+63.1%
HK$135.00
Analyst
IMPORTANT NOTICE - DISCLOSURES AND DISCLAIMERS
This report is provided subject to, and must be read together with, the full Disclosures / Disclaimers available at this link, which are incorporated by reference into this report. In particular, this report is intended for general circulation and informational purposes only and does not constitute personal investment advice or a recommendation to buy or sell any investment product or security. You should independently evaluate the information and, where necessary, seek advice from a qualified financial adviser regarding the suitability of any investment. Analyst certifications required under applicable regulations, including SEC Regulation AC (where relevant), are included in this report. By accessing, receiving or using this report, you acknowledge that you have read, understood and agreed to be bound by the Disclosures / Disclaimers, as may be amended, supplemented or updated from time to time.
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