China Specialist, Auto and Industrial Specialist

Victoria Li

Equity Bottom-Up

Our positive view on Xpeng remain intact after recent market correction. We believe current share price offers unmissable opportunity for investors to buy/add on Xpeng. Because, fundamentally, Xpeng is on a good trajectory.1) NGP released in Jan 2021 became the star product of Xpeng, which is gaining new customers quickly. In Feb, NGP activation rate reached 20%. Increasing sales from NGP would also largely improve Xpeng’s margins.2) LFP battery models, released on 3rd March, lowered the entry level cars qualified for NGP to Rmb239.9k from Rmb259.9k, and is expected to boosted sales and margins. In the first week of launching, LFP models contributed 20% of new orders3) Xpeng’s lately released Q42020 is solid. Q4 gross margin improved to 7.4% with net loss narrowing. FY2020 gross margin turned positive.4) New model, P5 with Xpiliot 3.5, would be launched in Q2. As a smaller segment car with lower entry model price but upgraded autonomous driving functions, P5 is expected to bring higher sales volume than P7. Facelift on G3 would be launched in Q3.5) Xpeng’s production capacity might be temporarily affected by production line upgrade, which lead to weak sales data in Feb. However, the production line upgrading would help Zhaoqing factory to reach capacity of 10,000 unit/month in this year.Strong BUY. Reiterate TP of US$71.

Our positive view on Xpeng remain intact after recent market correction. We believe current share price offers unmissable opportunity for investors to buy/add on Xpeng. Because, fundamentally, Xpeng is on a good trajectory.1) NGP released in Jan 2021 became the star product of Xpeng, which is gaining new customers quickly. In Feb, NGP activation rate reached 20%. Increasing sales from NGP would also largely improve Xpeng’s margins.2) LFP battery models, released on 3rd March, lowered the entry level cars qualified for NGP to Rmb239.9k from Rmb259.9k, and is expected to boosted sales and margins. In the first week of launching, LFP models contributed 20% of new orders3) Xpeng’s lately released Q42020 is solid. Q4 gross margin improved to 7.4% with net loss narrowing. FY2020 gross margin turned positive.4) New model, P5 with Xpiliot 3.5, would be launched in Q2. As a smaller segment car with lower entry model price but upgraded autonomous driving functions, P5 is expected to bring higher sales volume than P7. Facelift on G3 would be launched in Q3.5) Xpeng’s production capacity might be temporarily affected by production line upgrade, which lead to weak sales data in Feb. However, the production line upgrading would help Zhaoqing factory to reach capacity of 10,000 unit/month in this year.Strong BUY. Reiterate TP of US$71.

Chart based progressive global trading strategies, Chart Partners

Thomas Schroeder

Chart based progressive global trading strategies

Chart Partners

Chart Partners objective is to discover medium-term cycle turns and profit opportunities before they unfold, within structural trends while preserving capital with clear degrees of risk. We have real return ideas. 

Markets are dynamic and trading systems must reflect this. It is crucial to determine underlying correlations and lead-lag relationships within global markets and the impact on linked instruments. Our weekly Chartonics product gives you short-term trading strategies that can be applied within the medium and longer term macro trends that are mapped out in our strategy updates. 

Our methodology fuses global market variables and isolates drivers in trends. We specialize in FX, index trade in NY and Asia with a focus on Asian stocks. 

Technical Analysis

<a href="https://www.smartkarma.com/entities/xpeng-inc" target="_blank" data-smartkarma-citation="entities:29217:1" rel="noopener">Xpeng (XPEV US)</a> is setting up a cycle low as the RSI bull wedge matures and we pick at a c wave pullback low. Upside hurdle resistance, once cleared will open the way to new highs.  Light sell volume concurs with this pullback being corrective in nature (a-b-c formation).New high projection lies at 92.

Xpeng (XPEV US) is setting up a cycle low as the RSI bull wedge matures and we pick at a c wave pullback low. Upside hurdle resistance, once cleared will open the way to new highs.  Light sell volume concurs with this pullback being corrective in nature (a-b-c formation).New high projection lies at 92.

Japan/Asia Long-Short, LightStream Research

Mio Kato

Japan/Asia Long-Short

Long-Short Analysis on Japan, Asia and the World

LightStream Research

LightStream conducts quantitatively rigorous and data-driven analysis with a focus on Japan and Asia.

We consistently cover the Tech, Consumer and Industrial sectors, and provide ECM and Events coverage more broadly.

We supplement traditional qualitative insights from company relationships with a robust quantitative foundation that examines as much historical data as is available.
We further refine the accuracy of our insights and calls through the use of alternative data to flesh out current trends, and through a valuation framework that emphasises non-superficial peer group selection and a proper attempt to understand the metrics and changes that have driven security valuations in the past.

With Tesla down 22.4% from its recent all-time high and as much 31.3% at the lows yesterday, and competition increasing with the high profile SPAC investment in Lucid, we believe it is time to seriously consider the short thesis again, for EVs overall, but Tesla in particular.

With Tesla down 22.4% from its recent all-time high and as much 31.3% at the lows yesterday, and competition increasing with the high profile SPAC investment in Lucid, we believe it is time to seriously consider the short thesis again, for EVs overall, but Tesla in particular.

Tesla – Threats from the Taycan and Lucid Air

Xpeng's share performance has been weak recently. We believe this is mainly due to concerns in the market on the IPO lock-up period expiring. The company's fundamental stays solid. January car delivery had the best MoM growth rate among peers. Recently released NGP is being recognized by customers as the best guided auto pilot in China, which would be a strong driver of its car sales.Xpeng lock up period will expire on 23rd Feb. We believe any further share performance weakness before and after the date would be great buying opportunity.

Xpeng's share performance has been weak recently. We believe this is mainly due to concerns in the market on the IPO lock-up period expiring. The company's fundamental stays solid. January car delivery had the best MoM growth rate among peers. Recently released NGP is being recognized by customers as the best guided auto pilot in China, which would be a strong driver of its car sales.Xpeng lock up period will expire on 23rd Feb. We believe any further share performance weakness before and after the date would be great buying opportunity.

Xpeng - Lock-Up Period Expiry Concerns Create Buying Opportunity

Head of Research, IPOs & Placements, Aequitas Research

Sumeet Singh

Head of Research, IPOs & Placements

IPOs and Placements coverage across Asia Pacific

Aequitas Research

We cover all listing across the Asia Pacific along with follow-up placements. As of Dec 2020, our team had covered 539 IPOs with a hit rate of 73.5% and 685 placements with a hit rate of 66.8%.

We combine fundamental bottom-up views with our proprietary quantitative framework to provide a holistic coverage across new listings and placements. Our coverage includes pre-IPO notes before the deal is launched, follow-up analysis once the deal is live and post-listing trading analysis as well.

Equity Capital Markets

RLX Technology Inc / Equity Capital Markets

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<a href="https://www.smartkarma.com/entities/rlx-technology-inc" target="_blank" data-smartkarma-citation="entities:31113:1" rel="noopener">RLX Technology Inc (RLX US)</a> has raised around US$1.4bn in its US listing. RLX is the largest branded e-vapor company in China with a market share of closed-system e-vapor products in terms of retail sales value of 48% in 2019 and 62.6% over 9M20. 
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In our previous note, links to which are below, we have spoke about various aspects of the deal. In this note, talk about the trading dynamics and provide a valuation table at different  share price levels.
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Links to our previous notes:
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<ul style="list-style-type: disc;">
<li>
<a href="https://www.smartkarma.com/insights/rlx-technology-pre-ipo-the-positives-fast-growth-low-penetration" target="_blank" data-smartkarma-citation="insights:46797" rel="noopener">RLX Technology Pre-IPO - The Positives - Fast Growth, Low Penetration</a> </li>
<li><a href="https://www.smartkarma.com/insights/rlx-technology-pre-ipo-the-negatives-limited-track-record-and-missing-international-ops" target="_blank" data-smartkarma-citation="insights:46836" rel="noopener">RLX Technology Pre-IPO - The Negatives - Limited Track Record, and Missing International Ops</a></li>
<li><a href="https://www.smartkarma.com/insights/rlx-technology-pre-ipo-rlx-store-visits-to-relx-and-its-competitors" target="_blank" rel="noopener">RLX Technology Pre-IPO (RLX): Store Visits to Relx and Its Competitors</a></li>
<li><a href="https://www.smartkarma.com/insights/rlx-technology-pre-ipo-peer-comparison-and-valuation" target="_blank" rel="noopener">RLX Technology Pre-IPO - Peer Comparison and Valuation</a></li>
<li><a href="https://www.smartkarma.com/insights/rlx-technology-ipo-valuation-has-more-than-doubled-in-two-months" target="_blank" rel="noopener">RLX Technology IPO - Valuation Has More than Doubled in Two Months</a></li>
</ul>
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RLX Technology Inc (RLX US) has raised around US$1.4bn in its US listing. RLX is the largest branded e-vapor company in China with a market share of closed-system e-vapor products in terms of retail sales value of 48% in 2019 and 62.6% over 9M20. 


In our previous note, links to which are below, we have spoke about various aspects of the deal. In this note, talk about the trading dynamics and provide a valuation table at different  share price levels.


Links to our previous notes:




RLX Technology Pre-IPO - The Positives - Fast Growth, Low Penetration 
RLX Technology Pre-IPO - The Negatives - Limited Track Record, and Missing International Ops
RLX Technology Pre-IPO (RLX): Store Visits to Relx and Its Competitors
RLX Technology Pre-IPO - Peer Comparison and Valuation
RLX Technology IPO - Valuation Has More than Doubled in Two Months



RLX Technology IPO Trading - We Won't Be Chasing

China

XPeng Inc. designs, produces, and distributes electric vehicles. The Company designs, develops, manufactures and markets smart smart electric vehicles, as well as finance, parts, and maintenance services. XPeng serves customers in China.

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XPeng (XPEV US)

Xpeng: Don't Miss the Gem

Our positive view on Xpeng remain intact after recent market correction. We believe current share price offers unmissable opportunity for investors...

Victoria Li

XPENG 31 Bull Support

Xpeng (XPEV US) is setting up a cycle low as the RSI bull wedge matures. Upside hurdle resistance, once cleared will open the way to new highs. ...

Thomas Schroeder

Tesla – Threats from the Taycan and Lucid Air

With Tesla down more than 20% from its recent highs, we examine the prospects for the EV bubble finally popping as competition intensifies just as...

Mio Kato

Xpeng - Lock-Up Period Expiry Concerns Create Buying Opportunity

Xpeng's share performance has been weak recently. We believe this is mainly due to concerns in the market on the IPO lock-up period expiring.

Victoria Li

RLX Technology IPO Trading - We Won't Be Chasing

RLX Technology Inc (RLX US) raised around US$1.4bn in its US listing. RLX is the largest branded e-vapor company in China with a market share of...

Sumeet Singh

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