Macquarie Reiterates Underperform on Li Auto, $15 PT

Macquarie analyst Eugene Hsiao reiterated an Underperform rating and $15.00 price target on Li Auto (NASDAQ: LI).

“Li Auto reports 4Q25 results, holds call post-close • What we liked: 1) Clean 4Q results, unlike 3Q impacted by MEGA recall; 2) management confirmation the i6 supply-chain issues have been resolved; 3) QoQ improvement of the company’s cash position to Rmb101.2bn (3Q Rmb98.9bn), which should provide a financial buffer; 4) more proactive stance on overseas growth, with a mid-single-digit sales contribution likely this year. • What we didn’t like: 1) Vehicle margin of 16.8% (4Q24 19.7%), which looked weak and suggests further pressure ahead; 2) new model launches limited to i9 BEV and refresh of L-series, implying less incremental volume upside in FY26. • 1Q guidance: Midpoint of 85-90k unit target in line with BBG consensus but 4% below MQe.

Midpoint of Rmb20.4-21.6bn rev guide below BBG/ MQe by 14%/7%, implying an Rmb240k ASP (vs BBG 280k), likely due to low-end mix and discounting.

Management targeting FY26 volume growth of 20% YoY, but weaker margins could be seen.

We maintain our view that Li Auto’s margins, at one point the highest among China NEV peers, will continue to face severe pressure.

While management has high expectations of shifting the mix toward luxury SUVs (9-series), we are cautious in the midst of ample competition, with the successful launch of Zeekr’s 9X and the strength of the Aito M9 as well as NIO’s upcoming ES9.

We remain sceptical of a quick recovery of EREV market share in the near term and maintain our Underperform rating.”

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