Great Wall Motor Dominates China’s Auto Market with Innovative Products and Global Expansion
UOB Kay Hian, 31 March 2025
Great Wall Motor’s 4Q24 Earnings Meet Expectations, Driven by Strong Product Lineup and Overseas Growth
Great Wall Motor (GWM), the leading Chinese automaker, has reported its fourth-quarter 2024 results, showcasing its resilience and growth potential in the dynamic automotive landscape. The company’s net profit of Rmb2,264m in 4Q24 represents an 11.7% year-over-year increase, though a 32.4% quarter-over-quarter decline due to a Rmb4b year-end bonus for its staff.
Robust Product Pipeline and Overseas Expansion to Drive Earnings Growth
Looking ahead, GWM’s earnings growth will be fueled by its strong product cycle and successful expansion into international markets. The company plans to launch at least one new model every month in 2025, including the highly anticipated all-new Tank 300, Haval Xiaolong MAX, and the smart driving version of the High Mountain model.
On the technology front, GWM will introduce a suite of advanced features, such as the Hi4-T intelligent four-wheel drive system, an 800V high-voltage charging platform, navigation on autopilot without high digital maps, and the Coffee operating system 4.5 smart cockpit platform.
Overseas markets will also be a key driver of GWM’s growth, with the company aiming to increase its sales centers from 310 in 2024 to 500 and 1,000 in 2025 and 2027, respectively.
Diversifying into Heavy-Duty Trucks and Motorcycles
In addition to its core automotive business, GWM is making strategic forays into new segments. The company will enter the heavy-duty truck (HDT) market in 2025, leveraging its Hi4-G hybrid technology and dual motors to offer fuel-efficient HDTs. GWM targets to sell 10,000, 30,000, and 50,000 HDTs in 2025, 2026, and 2027, respectively.
Furthermore, GWM will unveil its first motorcycle model, the S2000, equipped with a parallel eight-cylinder engine, diversifying its product portfolio.
Financial Projections and Valuation
UOB Kay Hian maintains its 2025-2026 sales volume estimates at 1.35 million units and 1.5 million units, respectively, and introduces a 2027 estimate of 1.65 million units, implying a 10% compound annual growth rate.
The analysts also maintain their 2025-2026 average selling price assumptions at Rmb148,000 and Rmb153,000, respectively, and introduce a 2027 assumption of Rmb158,000, reflecting a 3.6% CAGR.
Gross margin assumptions for 2025-2027 are maintained at 19.5%, supported by the optimization of the sales mix and operational efficiency improvements.
UOB Kay Hian maintains its 2025-2026 net profit forecasts at Rmb14.10 billion and Rmb16.09 billion, respectively, and introduces a 2027 net profit forecast of Rmb18.05 billion.
The report maintains a “Buy” rating on Great Wall Motor with a target price of HK$23.00, based on a 15x 2025 forward price-to-earnings ratio, in line with the stock’s historical average.
Conclusion
Great Wall Motor’s strong performance in the fourth quarter of 2024 and its robust product pipeline, technological advancements, and global expansion plans position the company for continued growth and success in the Chinese and international automotive markets. The company’s diversification into heavy-duty trucks and motorcycles further enhances its long-term prospects, making it a compelling investment opportunity for investors.
