Guangzhou Automobile Group Co (2238) AI Stock Analysis

• Market Cap: HK$68.75B
• Dividend Yield: 1.46%
• Average Volume (3M): 21.53M
• Price to Earnings (P/E): 34.4
• Beta (1Y): 0.88
• Revenue Growth: -18.42%
• EPS Growth: -82.40%
• Country: HK
• Employees: 86,451
• Sector: Consumer Cyclical
• Sector Strength: 60
• Industry: Auto - Manufacturers
• EPS (TTM): -0.08
• Shares Outstanding: 2,813,368,400
• 10 Day Avg. Volume: 22,445,413
• 30 Day Avg. Volume: 21,529,935
• PEG Ratio: 0.71
• Price to Book (P/B): 0.42
• Price to Sales (P/S): 0.00
• P/FCF Ratio: -3.60
• Enterprise Value/Market Cap: N/A
• Enterprise Value/Revenue: N/A
• Enterprise Value/Gross Profit: N/A
• Enterprise Value/Ebitda: N/A
• 1Y Price Target: HK$2.90
• Price Target Upside: -2.54% Downside
• Rating Consensus: Hold
• Number of Analyst Covering: 3

• Rating: 53 Neutral
• Price Target: HK$3.00 ▲(0.67%Upside)

The overall stock score reflects significant challenges in financial performance and valuation. The financial health of Guangzhou Automobile Group Co is mixed, with profitability pressures evident. Technical analysis shows neutral signals, while the valuation appears high given the current financial standing.

Positive Factors

Market Demand

The market demand for GAC Toyota and GAC Honda has also recovered a bit recently aided by the peak season and stimulus measures.

New Model Launches

Management is determined to revive its homegrown brands with a plethora of new models in 2025.

Negative Factors

Earnings Forecast

Earnings forecasts were revised down due to lower gross margins amid fiercer competition and lack of competitive NEVs until 2026.

Financial Performance

GAC posted the largest quarterly net loss (RMB1.4bn) in 3Q24 since at least 2013, partly due to the FX loss and lower government grants.

Sales Volume

Self-brand sales volume fell 35% y/y to 1.0mn for 7M24, due to lack of BEV and PHEV exposure. Sales prospects to remain challenging.

Guangzhou Automobile Group Co Business Overview & Revenue Model

Company Description

Guangzhou Automobile Group Co., Ltd., together with its subsidiaries, engages in the research, development, manufacture, and sale of vehicles and motorcycles, and parts and components; and provision of commercial and financial services in Mainland China and internationally. The company operates through two segments, Vehicles and Related Operations, and Others. It offers large to medium sized passenger vehicles, light and heavy trucks, construction vehicles, and energy vehicles; motorcycles comprising standard motorcycles, sport bikes, scooters, etc.; and auto-parts and components, including engines, gearboxes, car seats, micro motors, shifters, electric controllers, and interior and exterior decorations. The company also provides financial investment, insurance, insurance brokerage, financial leasing, automobile credit, and other related services; and engages in the businesses of vehicle sales, logistics, international trading, second-hand vehicles, end-of-life vehicles disassembling, resources recycling, supporting services, digitalization and mobility transportation services, etc. In addition, it offers investment management services; and engages in the trade of steel. The company was incorporated in 1997 and is headquartered in Guangzhou, the People's Republic of China. Guangzhou Automobile Group Co., Ltd. is a subsidiary of Guangzhou Automobile Industry Group Co., Ltd.

How the Company Makes Money

GAC Group generates revenue primarily through the manufacture and sale of a wide range of vehicles, including passenger cars and commercial vehicles. The company operates several joint ventures with international automotive companies such as Toyota, Honda, and Stellantis, which significantly contribute to its revenue by expanding its product portfolio and market reach. Besides vehicle sales, GAC Group earns money from the production and distribution of auto parts and components. The company also engages in automotive-related services, including financing, insurance, and after-sales services, which provide additional revenue streams. These diverse operations, along with strategic partnerships, play a crucial role in the company's financial performance.

Guangzhou Automobile Group Co Financial Statement Overview

Summary

Guangzhou Automobile Group Co shows mixed financial health with evident challenges in profitability and cash flow generation. Despite some periods of growth, recent financial results highlight operational and profitability pressures. The balance sheet remains relatively stable, providing a buffer against short-term financial risks. Strategic focus on improving operational efficiency and cash flow generation will be crucial for future financial performance.

Income Statement

The company's revenue has seen fluctuations with a notable decline in the most recent TTM period. Recent margins, like the gross profit margin and net profit margin, have weakened, with the company recording negative EBIT and EBITDA margins in the TTM. This indicates challenges in operational efficiency and profitability, despite past periods of positive margins.

Balance Sheet

The balance sheet shows a stable equity position with a healthy equity ratio, indicating financial stability. The debt-to-equity ratio remains manageable, although there is an increase in total debt over time. The return on equity has deteriorated due to recent net losses, suggesting pressure on shareholder returns.

Cash Flow

Operating cash flow has shown improvement in the TTM, but free cash flow remains negative due to high capital expenditures. The ratio of operating cash flow to net income has been inconsistent, reflecting variability in cash generation relative to accounting profits. Overall, cash flow management appears challenged by high capital needs.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	106.10B	107.78B	129.71B	110.01B	75.68B	63.16B
Gross Profit	5.63B	7.18B	9.76B	8.22B	6.41B	4.37B
EBITDA	-2.41B	8.51B	10.42B	14.38B	13.31B	11.14B
Net Income	-1.13B	823.58M	4.43B	8.06B	7.33B	5.97B
Balance Sheet
Total Assets	213.13B	232.46B	218.39B	190.02B	154.20B	142.81B
Cash, Cash Equivalents and Short-Term Investments	40.41B	54.18B	56.01B	43.74B	27.26B	30.10B
Total Debt	25.70B	29.82B	22.06B	20.61B	17.28B	16.35B
Total Liabilities	92.69B	110.68B	93.99B	67.77B	61.60B	56.15B
Stockholders Equity	113.38B	114.35B	115.72B	113.23B	90.26B	84.32B
Cash Flow
Free Cash Flow	-4.56B	59.36M	-4.85B	-13.36B	-11.83B	-9.47B
Operating Cash Flow	8.77B	10.92B	6.73B	-5.35B	-5.59B	-2.89B
Investing Cash Flow	-9.39B	-11.75B	-2.47B	-3.83B	1.65B	468.81M
Financing Cash Flow	252.82M	2.21B	4.07B	24.28B	72.84M	-1.79B

Guangzhou Automobile Group Co Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 2.98
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For HK:2238, the sentiment is Positive. The current price of 2.98 is above the 20-day moving average (MA) of 2.84, above the 50-day MA of 2.80, and above the 200-day MA of 2.97, indicating a bullish trend. The MACD of 0.05 indicates Negative momentum. The RSI at 62.53 is Neutral, neither overbought nor oversold. The STOCH value of 77.43 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for HK:2238.

Guangzhou Automobile Group Co Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
Sector *	56 Neutral	$3.37B	4.05	-1.30%	6.64%	0.16%	-63.79%
2238	53 Neutral	HK$68.75B	34.37	-0.98%	1.46%	-18.42%	-82.40%
GELYF		$21.15B	7.16	24.35%	2.04%	―	―
BMCLF		$2.06B	15.17	1.66%	7.24%	―	―
DNFGF		$3.77B	520.00	0.04%	1.35%	―	―
GWLLF		$22.83B	8.72	14.58%	2.65%	―	―
9868	57 Neutral	HK$131.56B	―	-15.50%	―	49.80%	50.02%

Guangzhou Automobile Group Co Corporate Events

Guangzhou Automobile Group Reports Decline in June 2025 Production and Sales

Guangzhou Automobile Group Co., Ltd. reported a decline in both production and sales volumes for June 2025, with production down by 10.05% and sales down by 8.22% compared to the previous year. The company’s year-to-date figures also show a decrease, with production down by 6.73% and sales down by 12.48%. Despite the overall decline, there was a slight increase in the production of new energy vehicles, which rose by 3.58% for the month, indicating a potential shift in focus towards more sustainable vehicle options.

The most recent analyst rating on (HK:2238) stock is a Sell with a HK$1.00 price target. To see the full list of analyst forecasts on Guangzhou Automobile Group Co stock, see the HK:2238 Stock Forecast page.

Guangzhou Automobile Group Announces Change of Service Agent in Hong Kong

Guangzhou Automobile Group Co., Ltd. has announced a change in its agent for the service of process in Hong Kong, effective from June 20, 2025. Ms. HE Dan will replace Mr. GAO Feng in this role, a move that aligns with the company’s compliance with local regulations and may impact its operational procedures in Hong Kong.

The most recent analyst rating on (HK:2238) stock is a Sell with a HK$1.00 price target. To see the full list of analyst forecasts on Guangzhou Automobile Group Co stock, see the HK:2238 Stock Forecast page.

Guangzhou Automobile Group Reports Decline in May 2025 Production and Sales

Guangzhou Automobile Group Co., Ltd. reported a decline in both production and sales volumes for May 2025, with a notable year-on-year decrease of 8.16% in production and 24.80% in sales. Despite the overall downturn, the company saw growth in energy-efficient vehicle production and sales, highlighting a strategic shift towards more sustainable automotive solutions.

The most recent analyst rating on (HK:2238) stock is a Sell with a HK$1.00 price target. To see the full list of analyst forecasts on Guangzhou Automobile Group Co stock, see the HK:2238 Stock Forecast page.

Guangzhou Automobile Group Announces AGM Results and Dividend Declaration

Guangzhou Automobile Group Co., Ltd. held its 2024 Annual General Meeting on May 23, 2025, where all proposed resolutions were approved by shareholders. The meeting included the declaration of the final dividend for the year ended December 31, 2024, and addressed the withholding and payment of taxes for non-resident enterprise holders and individual holders of overseas H shares. The AGM was conducted in compliance with the relevant legal and regulatory requirements, and the resolutions were passed by a significant majority of the voting shareholders.

The most recent analyst rating on (HK:2238) stock is a Sell with a HK$1.00 price target. To see the full list of analyst forecasts on Guangzhou Automobile Group Co stock, see the HK:2238 Stock Forecast page.

Guangzhou Automobile Group Announces Final Dividend for 2024

Guangzhou Automobile Group Co., Ltd. announced a final cash dividend of RMB 0.02 per share for the financial year ending December 31, 2024, with shareholders’ approval obtained on May 23, 2025. The dividend will be paid in Hong Kong dollars at an exchange rate of RMB 1 to HKD 1.08738, and is subject to withholding tax rates of 10% for non-resident enterprises and individuals, and 20% for Southbound Trading investors. This announcement reflects the company’s commitment to returning value to shareholders while adhering to tax regulations, potentially impacting investor sentiment and market positioning.

The most recent analyst rating on (HK:2238) stock is a Sell with a HK$1.00 price target. To see the full list of analyst forecasts on Guangzhou Automobile Group Co stock, see the HK:2238 Stock Forecast page.

Guangzhou Automobile Group Reports Decline in April 2025 Production and Sales

Guangzhou Automobile Group Co., Ltd. reported a significant decline in both production and sales volumes for April 2025, with a 25.74% decrease in production and a 12.66% drop in sales compared to the previous year. Despite the overall downturn, the company saw a slight increase in the sales of new energy vehicles, reflecting a strategic shift towards more sustainable automotive solutions.

Guangzhou Automobile Group Announces 2024 AGM with Key Resolutions

Guangzhou Automobile Group Co., Ltd. has announced its 2024 Annual General Meeting, scheduled for May 23, 2025, where shareholders will consider and vote on several resolutions, including the 2024 annual report, financial report, and profit distribution proposal. The meeting will also address the appointment of auditors and related party transactions, reflecting the company’s commitment to transparency and strategic planning, which could impact its operational efficiency and stakeholder relations.

Guangzhou Automobile Group Reports Significant Q1 2025 Loss

Guangzhou Automobile Group Co., Ltd. reported a significant decline in its financial performance for the first quarter of 2025. The company’s revenue from operations decreased by 7.95% compared to the same period last year, and it recorded a net loss attributable to shareholders of RMB 731.6 million, a stark contrast to the profit of RMB 1.22 billion in the previous year. The net cash flow from operating activities also worsened, indicating financial challenges that could impact its market positioning and stakeholder confidence.

Guangzhou Automobile Group Schedules Board Meeting for Q1 Results

Guangzhou Automobile Group Co., Ltd. has announced that its board of directors will convene on April 25, 2025, to review and approve the unaudited financial results for the first quarter ending March 31, 2025. This meeting is significant as it will provide insights into the company’s financial performance and strategic direction, potentially impacting stakeholders and market positioning.