CMB International: Investors should pay attention to whether the new orders for NIO-SW(09866) and BYD COMPANY(01211) in July can continue to grow compared to the previous month.

Guosen International released a research report stating that the leading indicators of the six major new energy vehicle brands in June showed differentiation, with NIO-SW (09866) and BYD COMPANY (01211) seeing a rise in their main indicators compared to the previous month, while Tesla and Xpeng saw a decline. The leading indicators of Xiaopeng Motors and Aiyn remained weak. The bank expects a month-on-month decline in overall new energy vehicle retail sales in July. In July, the bank believes investors should pay attention to whether the new orders for NIO and BYD Company Limited can continue to increase on a month-on-month basis, especially NIO's order conversion rate. In addition, the listing of Mona M03 is also expected to become a short-term catalyst for Xpeng's stock price. The report stated that the total number of inquiries per store for the six major brands declined by 1% in June. Among them, Ideal Car saw the largest decline in the number of inquiries compared to the previous month (-11%), mainly due to the end of the promotion activities for the L6 new model. Tesla's number of inquiries per store also decreased by 4% in June, which may explain why Tesla introduced interest-free policies on July 1st. Although NIO's terminal discounts decreased compared to May, the number of inquiries per store in June increased by 2%, exceeding the bank's expectations. BYD Company Limited's number of inquiries per store increased by 7% in June, showing the strongest performance among the six major brands. The total number of store foot traffic for the six major brands decreased by 7% in June. The foot traffic per store for Ideal Car decreased by 18% in June, while the foot traffic for Tesla and Xpeng also decreased by 7-8% month-on-month. Although the number of inquiries for NIO and Aiyn increased compared to the previous month, their foot traffic per store decreased by 4% and 9% respectively due to a decrease in conversion rates. BYD Company Limited was the only brand to achieve a month-on-month increase in foot traffic per store last month, mainly benefiting from the launch of the Qin L and Sea Lion 06 PHEV. In terms of new orders, the total number of new orders per store for the six major brands increased by 2% in June, with NIO's number of new orders per store increasing by 11%, exceeding expectations and mainly benefiting from the improvement in the in-store conversion rate. BYD Company Limited saw a 10% increase in the number of new orders per store in June, indicating a potentially stronger performance in July. Ideal Car saw a 10% decrease in the number of new orders per store in June, slightly lower than the bank's expectations. The bank believes that in order to achieve the annual sales target, Ideal Car may need to implement a new round of price reductions in 3Q24.