Daily Investment Strategy
Daily focus：BYD（1211）
Intelligent driving mainly relies on large-scale model training. The more training is done, the more it can simulate the driving decisions of human drivers. With BYD’s 2024 sales surpassed 4 million units, BYD has a clear advantage in terms of scale. The stock has risen over 30% since our recommendation. Considering (1) breakthrough in smart driving may allow the gain of market share; (2) YTD exports exceed expectations, we raise our target price from HK$319.1 to HK$370. BYD's "God’s Eye" system comes in three versions: A (DiPilot 600), B (DiPilot 300), and C (DiPilot 100), covering the entire lineup. The God’s Eye C, offering parking and high-speed NOA, will be available on models starting at RMB69,800. This makes advanced smart driving accessible to a broader market, with models like the Qin L DM-i and Qin PLUS DM-i priced below RMB10k. Additionally, the entry-level system is expected to support the city NOA function via OTA update by the end of the year. BYD has caught up in smart driving technology, boosting its brand influence. As smart driving becomes the focus of electric vehicles, CEO of BYD Company predicts it will soon be as essential as seat belts and airbags. This year marks a shift toward the popularization of smart driving. While price competition may affect margins, BYD’s production scale gives it cost advantages, allowing it to have the capital to engage in potential "price wars".
The S&P 500 index set a new high, ignoring the jitters over interest rates and tariffs
The Federal Reserve released the minutes from its January meeting, but they did not reveal much new insight regarding the Fed's monetary policy, at a time when many expect the Fed to maintain steady rates for an extended period. The minutes indicated that "many participants, however, emphasized that additional evidence of continued disinflation would be needed to support the view that inflation was returning sustainably to 2 percent". The S&P 500 closed at a record high again on Wednesday, marking the second consecutive day of gains, despite signals from the Federal Reserve about pausing interest rate cuts. On Tuesday, Trump floated the idea of imposing a 25% tariff on imported cars, chips, and pharmaceuticals. Trump did not specify whether these potential tariffs would be targeted or broad but did mention they could be implemented as soon as April 2.
Hong Kong Stock Connect had a net inflow of HK$10.3bn Thursday of which Alibaba (9988) had the largest net inflow, reaching HK$2.83bn; followed by Kuaishou (1024). Meituan (3690) recorded the largest net outflow at $1.33bn, followed by XTALPI (2228).
Wen Kit Kenny is a SFC licensed person accredited to KGI Group to carry on regulated activities (for details, please refer to:https://apps.sfc.hk/publicregWeb/indi/AJF244/details). He and/or his associate do not have any financial interest in the recommended issuer or new listing applicant.
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