0720 GMT - Li Auto may face some near-term margin pressure, Daiwa's Kelvin Lau writes in a note. The analyst expects the Chinese automaker's vehicle gross margin to fall to 19% in 1Q and be squeezed further in 2Q. As for its gross margin, he doesn't expect much of a recovery in 2H due to the coming launch of a new fully electric model, which will likely be margin dilutive. Lau adds that the carmaker may lower battery costs further or leverage its economies of scale to manage costs better. Daiwa maintains a buy rating on the stock and raises the target price to $32.50 from $23.40 following signs of progress in U.S.-China trade talks. Li Auto's ADRs last closed at $27.96. (jiahui.huang@wsj.com; @ivy_jiahuihuang)
(END) Dow Jones Newswires
May 14, 2025 03:20 ET (07:20 GMT)
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