Citi Raises Price Targets for China’s Electric Vehicle Makers, Sees Stronger Sales by Investing.com

Investing.com– Citi raised its price targets for two Chinese electric vehicle makers, forecasting stronger sales amid resilient domestic conditions despite headwinds for the Chinese economy.

Citi raised its price target on Xpeng Inc (NYSE: ) to $10.30 from $8.90 and maintained a neutral rating on the stock. Citi raised its price target on Li Auto Inc (NASDAQ: ) to $25.50 from $21.60, while maintaining the stock at Neutral.

Xpeng US shares closed at $10.70 on Tuesday, while Li closed at $24.72.

The brokerage forecast higher sales for both firms, citing the upcoming launch of Xpeng P7 and a robust product book going into 2025. Citi also forecast a smaller loss for Xpeng over the next two years.

For Li Auto, Citi expects sales momentum to continue after a July-August sales surge and has also raised its sales and profit forecasts for the company.

Citi said both stocks reflected a fair level of valuations and that the risks and rewards on both were balanced.

Chinese electric vehicle makers have remained resilient even after the European Union, the US and Canada imposed heavy import tariffs on the sector earlier this year.

But with domestic demand accounting for the bulk of sales in the sector, import duties were expected to have a limited impact on overall sales. Among the three countries, only the EU has a considerable amount of electric vehicle imports from China.