Bernstein Maintains BYD’s ‘Outperform’ Rating
Bernstein analyst Eunice Lee kept on March 24, 2025, the price target of HK$460 on BYD’s Hong Kong-listed shares. The analyst reiterated an ‘Outperform’ rating on the stock.
“BYD: Decent Q4 print – Resilient performance amidst competition confirms positive view
Decent Q4 print
BYD posted 04 revenue of RMB 275bn, up 52.7% yoy and 36.7% qoq. EV & battery revenue grew 54.5% yoy and 39.4% qoq, while BYDE revenue was up 45.9% yoy and 26.7% qoq.
Net income was RMB 15.3bn, up 70.1% yoy and 26.4% qoq, and implied 5.6% net margin, vs. 5.0% in Q4 23 and 6.0% in Q3 24.
Net profit per car came in at RMB 9.3k, vs. RMB 8.5k in Q4 23 and RMB 9.3k in Q3 24, and broadly in-line with consensus.
Gross margin resilient
BYD recorded RMB 12.4bn as warranty expense in 2024, which was reclassified from selling and distribution expense to COGS.
Backing out the reclassification, on a like-for-like basis, overall gross margin would be solid at 21.5% for Q4 24, (vs. 17.09% *as reported”, assuming all charges were recorded in the quarter, and vs. 21.2% in Q4 23 and 21.9% in Q3 24), and EV & battery gross margin at 25.4% (vs. 25.1% in Q4 23 and 25.6% in Q3 24).
Fully factoring in warranty expense reclassification in both years, gross margin reached 19.4% in FY 2024, higher vs. 18.6% in 2023.
EV & battery segment gross margin reached 23.1% in FY 2024, also higher vs. 21.5% vs. FY 2023.
ADAS and fast charging upgrades to sustain growth momentum
BYD delivered a total of 1.52mn wholesale units in Q4 2024, +61.3% yoy and +34.3% qoq, of which PV accounted for 1.51mn units, +60.6% yoy and +34.1% qoq.
The PHEV product cycle from mid-2024 helped fuel BYD’s China’s PV market to 16.2% in Q4 24 (vs. 11.4% in Q4 23 and 17.8% in Q3 24), and in terms of EV market share, to 33.0% in Q4 24 (vs. 31.2% in Q4 23 and 35.5% in Q3 24).
We forecast BYD’s growth momentum will be sustained by the ADAS and battery upgrades, as well as overseas expansion in 2025.
Management will hold earnings conference presentation at 9:30 am Hong Kong Time on March 25th (Tuesday). We will follow up with takeaways from the meeting.”
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