期待在挑战持续存在的情况下重新设计的L9

AwaitredesignedL9amid lingering challenges Maintain HOLD.While we still believe Li Auto is an outstanding company andcould make a comeback with its solid cash position, wethinkits transformationto an AI device company still takes some time.The outlook of the redesignedL9is stilluncertain, in our view,given the heightened competition in the largeSUV market. We expect Li Auto to make a net loss in1H26E. Even with a 4Q25 earnings slightly beat on GPM.Li Auto’s 4Q25 revenue was about1% higher than our prior forecast.GPM in 4Q25 rose by 1.5ppts to 17.8%QoQ, 1.1ppts higher than our forecast, which we attribute to stronger-than-expected GPM from thei6andyear-end rebates from suppliers. R&D andSG&Aexpenses combined were in line with our projection, which led to anoperating loss of RMB443mn, or RMB200mn better than ourpriorforecast. China Auto Wait for more detailsof the redesignedL9.We are of theview that theredesignedL9and newi9are key models to watch this year.TheL9, thefirst new model to launch this year, could also pave the way for the new-generationL8andL7. We suggest investors wait for more details, as it isstill a bit early to conclude if theL9could differentiateitselffrom extremely FY26E earnings under pressure, making valuation unattractive.Thecompany has revised down its FY26 sales volume target from 0.5mn+ unitsto about 0.49mn units (+20% YoY).Management also expects vehicleGPM to be around 5% in 1Q26E amid inventory clearance and purchasetaxbenefit. Despite our assumptions of FY26E salesvolume of 0.49mnunits with 85,000 units for theL9(implying an average monthly salesvolume of 10,000+ units for the redesignedL9) and a full-year GPM of Valuation/Key risks.We maintain our HOLD rating and target price ofUS$18.00 for ADS and HK$70.00 for H-share,whichisbased on17x(prior18x) our FY27E P/Eandcorrespondsto39x (prior 40x) our FY26E P/E.We believe such valuation has priced in Li Auto’s competitive edge over itspeers. Key risks to our rating and target price include higher or lower sales Source: FactSet Disclosures& Disclaimers Analyst Certification The 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 issuerthat the analyst covered in this report: (1) all of the views expressedaccurately 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 to the 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 KongSecurities and Futures CMBIGM Ratings BUY: 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 Address: 45/F, Champion Tower, 3 Garden Road, Hong Kong, Tel: (852) 3900 0888 Fax: (852) 3900 0800CMB InternationalGlobal MarketsLimited (“CMBIGM”) is a wholly owned subsidiary of CMB International Capital Corporation Limited (a wholly ownedsubsidiary of China Merchants Bank) Important Disclosures There are risks involved in transacting in any securities. The information contained in this report may not be suitable forthe purposes of all investors.CMBIGMdoes not provide individually tailored investment advice. This report has been prepared without regard to the individual investment objectives, financial positionor special requirements. Past performance has no indication of future performance, and actual events may differ materially from that which is contained in thereport.The value of, and returns from, any investments are uncertain and are not guaranteed and may fluctuate as a result of their dependence on the or its affiliate(s) to whom it is distributed. This report is not and should not be construed as an offer or solicitationto buy or sell any security or any interest insecurities or enter into any transaction.NeitherCMBIGMnor any of its affiliates, shareholders, agents, consultants, directors, officers or employees shall beliable for any loss, damage or expense whatsoever, whether direct or consequential, incurred in relying on the information contained in this report.Anyonemaking use of the information contained in this report does so entirely at their own risk. CMBIGMhas exerted every effort in its capacity to ensure, but not to guarantee, their accuracy, completeness, timeliness or correctness.CMBIGMprovidesthe information, advices and forecasts on an "AS IS" basis.The information and contents are subject to change without notice.CMBIGMmay issue otherpublications having information and/ or conclusions different from this report.These publications reflect different assumption, point-of-view and analyticalmethods when compiling.CMBIGMmay make investment decisions or ta