DBS released a research report stating that GWMOTOR (02333) is accelerating its overseas expansion to enhance growth momentum, as China's domestic auto market is expected to slow down by 2026. DBS lowered GWMOTOR's target price from HK$23 to HK$19, equivalent to a forward P/E ratio of 10x for next year (previously 12x for this year), while maintaining a "Buy" rating. The company has planned an overseas production network to support sales and improve investment returns. For instance, its Brazil plant (capacity: 50,000 units) aims to penetrate Latin American markets such as Mexico, Argentina, and Chile, while leveraging its Thailand facility (capacity: 80,000 units) to target ASEAN/Asian markets. This strategy is expected to partially offset the slowdown in the Russian market, which accounts for about 10% of its auto sales. These facilities will produce models from its Haval series (H6, H9, etc.), ORA, and other lineups to shorten delivery times. DBS noted that GWMOTOR's Q3 gross margin pressure (down 1.3 ppts YoY; down 1.6 ppts QoQ to 17.2%) was mainly due to higher advertising and promotional expenses for new models (partly driven by market competition) and the expansion of its direct sales network. DBS expects the expanded network to improve sales efficiency, potentially stabilizing the product gross margin at around 19% by 2026. Consequently, DBS forecasts a 10% CAGR for GWMOTOR's earnings from 2024 to 2026, supported by a 13.7% revenue growth rate.