Geely is one of China’s leading automakers, having sold over 2 million cars in 2024. We maintain a positive outlook on Geely, as its new-energy vehicle (NEV) initiatives continue to make significant progress. The NEV-dedicated brand Galaxy has gained traction since its launch in 2023, while the premium brand Zeekr is steadily increasing its delivery rates. With a robust model lineup from both Galaxy and Zeekr, Geely is well-positioned to enhance its NEV penetration, which is crucial for its advancement in the electrification transition. The increase in sales volume, coupled with lower battery costs, may help mitigate pricing pressures amid industry competition. We believe that investors are underestimating the long-term earnings potential of the company’s diverse new-energy brands. Key near-term catalysts include strong monthly sales momentum from Galaxy and Zeekr, as well as a recovery in profitability.
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