Guangzhou Automobile Expected to Rack Up Further Losses -- Market Talk

Dow Jones
Sep 02

1102 GMT - Guangzhou Automobile looks set to post a wider-than-expected loss for the full year, Deutsche Bank analysts say after it swung to a loss in 1H. DB now expects the carmaker to post an annual loss of CNY2.65 billion versus the CNY744.8 million forecast previously. It assumes a much lower operating margin too, after GAC posted its worst-ever gross margin in 2Q. Fierce pricing competition in China's auto sector has pressured earnings. DB cites the price wars as a main driver of GAC's widened 2Q loss and margin decline. Fellow carmaker BYD has been offering dealers discounts since April, and GAC has been compelled to follow suit, leading to margin contraction, analyst Bin Wang says. DB cuts the stock to HK$3.50 to HK$3.90, but sticks to a buy rating. (jason.chau@wsj.com)

 

(END) Dow Jones Newswires

September 02, 2025 07:03 ET (11:03 GMT)

Copyright (c) 2025 Dow Jones & Company, Inc.

At the request of the copyright holder, you need to log in to view this content

Disclaimer: Investing carries risk. This is not financial advice. The above content should not be regarded as an offer, recommendation, or solicitation on acquiring or disposing of any financial products, any associated discussions, comments, or posts by author or other users should not be considered as such either. It is solely for general information purpose only, which does not consider your own investment objectives, financial situations or needs. TTM assumes no responsibility or warranty for the accuracy and completeness of the information, investors should do their own research and may seek professional advice before investing.

Most Discussed

  1. 1
     
     
     
     
  2. 2
     
     
     
     
  3. 3
     
     
     
     
  4. 4
     
     
     
     
  5. 5
     
     
     
     
  6. 6
     
     
     
     
  7. 7
     
     
     
     
  8. 8
     
     
     
     
  9. 9
     
     
     
     
  10. 10