Shares of Chinese electric car maker NIO Inc. jumped in Hong Kong on Tuesday, extending strong gains on Wall Street overnight.
The stock gained 17% to HK$168, as the Asian market resumed trading after a holiday on Monday. NIO’s American depositary receipts were up 14% at US$21.75 as of Monday’s market close.
The upturn came after Citi analysts in a note late Friday pointed out that NIO’s August retail sales, based on insurance data, outperformed those of most key rivals.
The analysts, citing new data from ThinkerCar, a widely-followed auto industry consultancy, noted that NIO’s retail sales are expected to have grown 63% on year in August, significantly outperforming those of main domestic rivals, such as Xpeng Inc. and Li Auto Inc.
The stronger sales momentum could be a result of NIO’s leadership in the luxury electric-vehicle market, CITIC Securities analysts said in a note Sunday. “Higher-end brands [such as NIO] typically can enjoy less competition and better profitability” thanks to demand stability, consumption upgrade and high industry concentration, the analysts said. They reiterated their buy call on NIO with a target price of HK$181.
NIO last week said its second-quarter net profit soared more than fourfold on year, while revenue rose 22%.