Morgan Stanley reaffirmed its ‘Overweight’ rating on US-listed shares of Nio on Monday, describing the stock as “like a call option” following an 11% surge in the EV maker’s Hong Kong-listed shares earlier in the day.
“With all the pessimism in the price, we think the stock is like a call option: NIOH’s (9866.HK) share price rose 11% today (vs. HSI [Hang Seng Index] + 0.3%) on the back of solid preorder intake for Onvo L90, which reached 30-35k units per our latest channel checks today,” Hsiao wrote.
Despite gaining 14.4% over the past five sessions, Nio’s US-listed shares remain down 10.5% year to date.
The model will offer a seven-seat version, with further details to be announced at the launch event later this month.
A five-seat variant — planned to be named the L80 — is scheduled for the fourth quarter.
It will compete with Li Auto’s i8 — which will be launched on July 29— the Aito M9, Lynk & Co 900, and BYD’s sub-brand model, the Denza N9.
The analyst Tim Hsiao had reiterated the rating and the $5.90 price target late last week, a few hours after Nio’s family-oriented sub-brand had pre-launched in the Chinese city of Hefei its second model.
“Although we strongly recognize Onvo L90’s advantages in the crowded race, beating market expectations isn’t without challenges considering Onvo’s unsatisfactory track record of execution and inferior brand awareness, which require extra effort for Onvo to leverage L90 and upcoming L80 to overcome the deficit,” Morgan Stanley analyst noted last week.
The model is priced at 279,900 yuan [$39,010] for the standard version, or 193,900 yuan [$27,020] with the Battery-as-a-Service (BaaS) option.
The analyst said last week that “the official pricing will likely come in below market expectations of Rmb270,000–280,000 [$37,800–$39,020].”
The official launch of the L90 is set for the end of July, with nationwide deliveries beginning on the first day of August.
Later this Monday, the brand’s chief Shen Fei will livestream a review of the SUV as part of the “Always Chatting” series.
“Shen Fei will guide you through an online experience of the Onvo L90,” Onvo wrote on Weibo. “Enjoy a premium three-row SUV in just one step.”
Nio is targeting monthly Onvo sales of 25,000 units by the fourth quarter.
The sub-brand registered 6,400 vehicles in June — its highest monthly total this year, and second only to its September 2024 debut.
