On Wednesday, JPMorgan revised its stance on Wuxi Lead Intelligent Equipment Co Ltd (300450:CH), altering the company's stock rating from Neutral to Underweight and adjusting the price target to RMB15.00 from RMB22.00. This change comes in the wake of the company's third-quarter results for 2024, which did not meet expectations, marking a consecutive shortfall after a similar occurrence in the second quarter of the year.
Wuxi Lead announced its third-quarter financial outcomes on October 29, after the market closed. The reported figures fell short of JPMorgan's estimates, prompting the firm to downgrade the stock. The earnings call, which took place on the evening of October 29, provided additional insights but did not alter the bank's new assessment of the stock.
The company's new order intake in the third quarter was RMB5 billion, showing a decline of 17% year-over-year and a 33% decrease from the previous quarter. This downturn brought the total new order intake for the first nine months of 2024 to RMB16 billion. Despite the disappointing performance, management has maintained its full-year guidance for new order intake at approximately RMB22 billion, which represents a static or slight decline compared to the previous year.
In the third quarter of 2024, over half of the new orders for Wuxi Lead came from overseas lithium battery equipment, maintaining a similar mix to that seen in the first half of the year. Meanwhile, domestic lithium battery equipment orders accounted for over 20% of the total new orders.
JPMorgan continues to favor CATL as the only Overweight-rated company in its coverage of the battery sector. The firm has an Underweight rating on all tier-2 battery makers, such as EVE, Gotion, and CALB, as well as on materials companies like Yunnan Energy and Putailai, in addition to equipment manufacturers including Wuxi Lead.
This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.