Written by Cláudio Afonso | LinkedIn | X
Shortly after Nio revealed the pricing details of the first model under its sub-brand Onvo, Morgan Stanley analyst Tim Hsiao published a research note stating the price “surprised the market on the upside.”
“We believe the share price will rise in absolute terms over the next 15 days. Nio unveiled Onvo L60 at an MSRP of Rmb206.9k (including a 60kWh battery), Rmb13k lower than the pre-sale price, while the BaaS model (excluding the 60kWh battery pack) is Rmb57k cheaper at Rmb149.9k, surprising the market on the upside,” Hsiao wrote.
Earlier this month, on September 15, Morgan Stanley opened a trade idea on the stock and closed it five days later on September 10 after a gain of roughly 40 per cent from $4.12 to $5.70, according to the research note.
While reiterating an Overweight rating and a $6.10 price target on the shares of the electric vehicle maker, the analyst noted that, together with incentives in China, will result in “higher order conversion and sales expectations.”
The price of the L60, a mid-size SUV, starts at 206,900 yuan ($26,307) when buying the car with a standard range (60kWh) battery while prices for the battery subscription model start at 149,900 yuan — equivalent to $21,208.
“This, coupled with an up to Rmb4k early bird cash discount (2k deposit for 6k cash discount) and a local government 10k trade-in subsidy, bodes well for higher order conversion and sales expectations,” he added before going into details.
“We estimate that there is about a 70 per cent to 80 per cent (or “very likely”) probability for the scenario. Estimated probabilities are illustrative and assigned subjectively based on our assessment of the likelihood of the scenario,” the analyst said as the firm opens — again — a new trade idea on the stock
Nio Senior VP and Onvo’s President, Alan Ai, said the deliveries of the debut model will start on September 28. The management has forecasted 10,000 monthly units delivered in December after the first few months of production ramp-up.
Customers who confirm their orders by October 8 receive benefits valued at 41,538 yuan, including five years of free NOA (Navigate on Autopilot) software, a “pay 4, get 1 free” offer on five years of battery rental, and 20 battery swap vouchers.
Written by Cláudio Afonso | LinkedIn | X
