The analyst said that the guidance cut mainly reflected COVID-led disruptions in deliveries/production and lingering supply constraints caused by rising COVID cases in major cities.
In the analyst’s view, a guidance cut might dampen NIO’s stock performance but shouldn’t trigger a sharp sell-off.
Hsiao said that the fallout from China’s reopening should be sector-wide and likely transitional.
The analyst expects the market to refocus on the pace of resurgence in-store traffic/order intake in the coming months.
The analyst factors solid volume growth over time and expects net profit to break even in 2024.
XPeng IncXPEV and Li Auto IncLI should also feel the heat, but the analyst sees relatively less downside to their more updated Q4 delivery targets of 20,000 – 21,000 and 45,000 – 48,000 units, respectively.
