卓越管理能力推动市场份额增长

Tuhu Car (9690 HK) Market share gain on superb management Target PriceHK$23.00(Previous TPHK$21.50)Up/Downside20.7%Current PriceHK$19.06 Maintain BUY.We are of the view that Tuhu’s 1H25 earnings were solid despiteindustry headwinds.While the long-term story (larger after-sales market sizewith higher margins and fewer players as number of vehicles on the road andaverageage of vehicles rise in China)remains true,Tuhu’s superbmanagementcapabilities, which is likely to help it continue gaining marketshare,could make investors less concerned about short-term industryvolatilities. China Auto Wenjing DOU, CFA(852) 6939 4751douwenjing@cmbi.com.hk Solid1H25earnings withadjusted net profit beat.Tuhu’s 1H25 revenuerose 11% YoY to RMB7.9bn,as the number ofstoresincreased14% YoY,in line with our prior forecast.Its trailing 12-month number of transactingusers rose 24% YoY to 24mn as of 30 Jun 2025, grabbing substantial marketshare amid industry-wide downturn.1H25 gross margin rose 0.3ppts HoH to25.2%, 0.2pptslower than our forecast, mainly due toalower-than-expectedgross marginfor tires and chassis parts.Tuhu’s 1H25 net profit rose 8% YoYtoRMB307mn,or 3%lower than our forecast due tohigher share-basedpayments (SBP).Its adjusted net profit (excl. SBP)thusrose 15% YoY toRMB410mn, higher than our forecast by 11%. Ji SHI, CFA(852) 3761 8728shiji@cmbi.com.hk Austin Liang(852) 3900 0856austinliang@cmbi.com.hk Stock Data Steady store expansion, healthy cash flow and superb operationalcapabilities make Tuhu better positionedthan peers.Tuhu’s storenumberincreased by 331 to 7,205 as of 30 Jun 2025, well on trackto achieveits full-year expansion of 900 new stores.About 90% of stores wereprofitableand almostallof them achievedpositivecash flow in 1H25.Thereare key factors to support Tuhu’s franchised store expansion, in our view.Tuhu also achieved positive free cash flow in 1H25, which could be crucialto survive and outrun peers amid industry headwinds. We attribute suchhealthy key metrics largely to Tuhu’s superb capabilities in managingcomplex supply chain and franchised stores, which will likelyhelp Tuhutocontinue gaining market share evenifmacro uncertainties linger. FY25-26E earnings forecasts. We cutour FY25E revenue forecast by 1%and GPM projection by 0.9ppts to factor in continuous macro uncertaintiesand management priority on store expansion over margin lift in the shortterm.We project its R&D and selling expense ratios (as % of revenue) to beflatYoY in FY25E,given rising expenditures in AI and advertising.Accordingly, we cut our FY25E adjusted net profit forecasts by 8%toRMB761mn, or22% YoYgrowth.We expect revenue to rise 9% YoY inFY26E, supported by continued store expansion and customer acquisitions.We project gross margin to widen YoY slightly to 25.9% in FY26E, andtherefore,15% YoY growth in adjusted net profit (RMB876mn) in FY26E. Source: FactSet Related Report“Tuhu Car(9690 HK)-Still better positioned than most rivals”-21 Mar2025 Valuation/Risks.We maintainourBUY rating andraisetarget pricefromHK$21.50 to HK$23.00, based on 20x adjusted FY26E (prior20xFY25E)P/E.Key risks include slower network expansion, lower revenue and/ormargins than we expect, as well as a sector de-rating. Disclosures& Disclaimers Analyst CertificationThe research analyst who is primary responsible for the content of this research report, in whole or in part, certifies thatwith respect to the securities or issuer that the analyst covered in this report: (1) all of the views expressed accurately reflect his or her personal views about the subject securities or issuer; and (2)no part of his or her compensation was, is, or will be, directly or indirectly, related tothe specific views expressed by that analyst in this report.Besides, the analyst confirms that neither the analyst nor his/her associates (as defined in the code of conduct issued by The Hong Kong Securities and Futures Commission) (1) have dealt in ortraded in the stock(s) covered in this research report within 30 calendar days prior to the date of issue of this report; (2)willdeal in or trade in the stock(s) covered in this research report 3 business days after the date of issue of this report; (3)serve as an officer of any of the HongKong listed companies covered in this report; and (4) have any financial interests in the Hong Kong listed companies coveredin this report. CMBIGM RatingsBUY : Stock with potential return of over 15%over next 12 monthsHOLD: Stock with potential return of +15% to-10% over next 12 monthsSELL: Stock with potential loss of over 10% over next 12 monthsNOT RATED: Stock is not rated byCMBIGM :Industry expected tooutperform the relevant broad market benchmark over next 12 months:Industry expected to perform in-line with the relevant broad market benchmark over next 12 months:Industry expected to underperformthe relevant broad market benchmark over next 12 months CMB InternationalGlobal MarketsLimited Address: 45/F, Champion Tower, 3 Ga