Company Coverage
Great Wall Motor (2333 HK): 2Q26: Earnings Dragged By Deferred Booking Of Tax Rebate And Forex Loss
HOLD (Maintained)
Current price:
Target price:
Upside:
HK$8.36
HK$9.90
18.4%
Analyst
Highlights
- 2Q26 net profit met estimates at Rmb1,519m (-66.9% yoy/+60.7% qoq). The earnings were dragged by deferred booking of overseas tax rebate and forex loss. Revenue outpaced sales volume growth by virtue of the ASP hike. Gross margin remained flat at 18.3%, in line with expectations.
- We expect earnings to resume growth in 2027, driven by new product debuts (eg WEY V9X, mass-market Haval H10, refreshed off-road Tank 300, and Cannon Hi4-T PHEV pickup) and buoyant overseas sales.
- We maintain our 2026-28 net profit forecasts at Rmb5,733m/Rmb8,171m/Rmb10,160m (-41.9%/+42.5%/+24.3% yoy). Maintain HOLD with target price of HK$9.90.
Analysis
- 2Q26 results met expectations with net profit of Rmb1,519m (−66.9% yoy/+60.7% qoq), at the mid-point of the guided range of Rmb1,404m-
1,654m, and adjusted net profit of Rmb1,128m (−46.6% yoy/+134.0% qoq), at the mid-point of the guided range of Rmb1,018m-1,268m.
- Earnings were dragged by deferred booking of overseas tax rebate and forex loss. A Rmb2.27b tax-policy subsidy was booked in 1H25, but the equivalent 1H26 subsidy was deferred and is expected in 2H26. Additionally, the forex gain (loss) swung from a net loss of Rmb266m in 1H26 from a net gain of Rmb1,493m in 1H25, due to the appreciation of the renminbi.
Highlights
- 2Q26 net profit met estimates at Rmb1,519m (-66.9% yoy/+60.7% qoq). The earnings were dragged by deferred booking of overseas tax rebate and forex loss. Revenue outpaced sales volume growth by virtue of the ASP hike. Gross margin remained flat at 18.3%, in line with expectations.
- We expect earnings to resume growth in 2027, driven by new product debuts (eg WEY V9X, mass-market Haval H10, refreshed off-road Tank 300, and Cannon Hi4-T PHEV pickup) and buoyant overseas sales.
- We maintain our 2026-28 net profit forecasts at Rmb5,733m/Rmb8,171m/Rmb10,160m (-41.9%/+42.5%/+24.3% yoy). Maintain HOLD with target price of HK$9.90.
Analysis
- 2Q26 results met expectations with net profit of Rmb1,519m (−66.9% yoy/+60.7% qoq), at the mid-point of the guided range of Rmb1,404m-
1,654m, and adjusted net profit of Rmb1,128m (−46.6% yoy/+134.0% qoq), at the mid-point of the guided range of Rmb1,018m-1,268m.
- Earnings were dragged by deferred booking of overseas tax rebate and forex loss. A Rmb2.27b tax-policy subsidy was booked in 1H25, but the equivalent 1H26 subsidy was deferred and is expected in 2H26. Additionally, the forex gain (loss) swung from a net loss of Rmb266m in 1H26 from a net gain of Rmb1,493m in 1H25, due to the appreciation of the renminbi.
HOLD (Maintained)
Current price:
Target price:
Upside:
HK$8.36
HK$9.90
18.4%
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.
Our latest research
26 Aug 2026
WuXi Biologics (Cayman) (2269 HK): 1H26: Exceeds Expectations; Robust Demand Fuels Accelerated Growth
26 Aug 2026
