HSBC Cuts Li Auto Target to $15.60 Citing Competition and Profit Headwinds
LI•HSBC trimmed Li Auto’s U.S. price target from $17.20 to $15.60 and cut the Hong Kong target to HK$61 from HK$67, maintaining a Hold rating. The bank shifted 2026 forecast to a loss and projects 2026-28 earnings 6–13% below consensus, as the L9 SUV attracted 10,000 orders in two weeks.
1. HSBC Revises Price Targets
HSBC lowered Li Auto’s U.S. price target from $17.20 to $15.60 and cut the Hong Kong target to HK$61, while maintaining a Hold rating.
2. Earnings Forecast Downgrade
The bank moved Li Auto’s 2026 outlook to a loss and now expects 2026-28 earnings 6%, 13%, and 9% below consensus, driven by weaker volume estimates, cost inflation pressure, and higher R&D spend.
3. Product Refresh Momentum
The newly refreshed L9 SUV logged around 10,000 orders in its first two weeks with a higher-end trim mix, and the upcoming L8 model launch later this month is poised to bolster deliveries.
4. Structural and Margin Challenges
HSBC warned that rising competition in premium BEVs and reliance on EREV technology may limit earnings upside, forecasting gradual margin recovery without a return to prior peak levels around 19-20%.
