Given all mentioned conservative opinion on BAIC`s self-owned brand, neutral view of Beijing Hyundai and optimistic expectation of Beijing Benz, we lower the profit forecast of the company in 2018/2019 to EPS of RMB 0.83 / 1.23. We will also revise target price to 9.3 HKD (9/6.1x for 2018/2019 P/E) and reaffirm accumulate rating. (Closing price as at 14 June 2018)
60% decline in 2017 while soar of 17.5% in Q1 2018
According to the result report of BAIC in Q1 2018, the company`s revenue increased to RMB39.8 billion, up 9.3% yoy and its net profit attributable increased to RMB1,595 million, up 17.5% yoy, reporting a significant mom improvement from RMB284 million in Q4 2017. EPS was RMB0.21.