Home » Macquarie: Xpeng at Outperform with 221HKD Target Price

Macquarie: Xpeng at Outperform with 221HKD Target Price

by SEP Editor
(Photo Credit: Xpeng)

Macquarie initiated XPeng Inc. (“XPeng” or the “Company”, NYSE: XPEV, HKEX: 9868. HK) at Outperform with a target price of 221 HKD. It forecasts a CAGR of 31.4% in Mainland electric vehicle sales over 2021-2024, compared with XPeng’s CAGR of 63.1% in sales and 66.3% in revenue.

In Macquarie’s report, XPeng is an EV start-up company focusing on the mid-sized vehicle market and autonomous driving. The company is favoured for the consistent growth in sales of its P7 model since its launch in 2020. P7 is considered as a balanced vehicle between technology and design. In addition, XPeng’s commitment to technological innovations and growth potential of the mid- to large-sized SUV G9, would advance the company to a new level in the EV industry.

XPeng P7 vs Tesla Model 3

Even before XPeng P7 launches, there has been a comparison between P7 and Tesla Model 3. With Tesla’s huge success in China, XPeng was the first up to a healthy competition. To begin with, XPeng is banking on the fact that the P7 is considerably less expensive than the Model 3, so it may appeal to more buyers. P7 is enabled with autonomous driving architecture which makes it the most powerful production vehicle in China. It has 14 cameras, 5 millimetre-wave radars, 12 ultrasonic sensors, centimetre-level high-definition positioning, decimeter-level AutoNavi high-definition mapping, NVIDIA Xavier system-on-the-chip computing platform, and Bosch iBooster brake system. On the other hand, Tesla is also equipped with lots of features. The Model 3 comes with the standard Autopilot capability and lane-keep assist. Both Tesla Model 3 and XPeng P7 have pretty standard USB, Bluetooth, and navigation connectivity. However, the Model 3 doesn’t come with SiriusXM satellite radio or an AM radio. It also doesn’t have Apple CarPlay or Android Auto. To sum up, XPeng P7 is keeping the competition tight. 

XPeng’s technological innovation

In addition, XPeng is an EV company that focuses heavily on technological innovation which will keep XPeng a steady lead in the field of intelligence. Statistics showed that as of the end 2021 Q3, the R&D team of XPeng has employed more than 4,000 people, an increase of more than 100% from the end of 2020. Within the R&D team, 66%, 17% and 17% were committed to automotive design and engineering, automatic driving and intelligent operating systems.

It is well known that the development of electric vehicles must solve four key technologies: battery technology, motor drive and its controlling, electric vehicle technology, and energy management technology. XPeng has put huge efforts in all aspects. As of the end of June in 2021, XPeng has 450 patents worldwide (including 52 invention patents), and another 1047 patents are being applied. Among these patents, over 50% of them involve the Internet and automatic driving. 

One patent to notice is the one a method that prevents electric vehicles from losing heat control (CN202010047927.6). When the car is losing heat control, the fire extinguishing device built inside the car automatically detects the emergency and starts extinguishing the battery, thereby reducing the risk of car explosion. XPeng has 132 patents related to battery to increase safety. 

XPeng G9(photo credit-Sina)

Photo Credit: sina

XPeng G9

XPeng revealed a new flagship SUV G9 in the past November and stated that it plans to launch the car in the third quarter of 2022. G9 is XPeng’s fourth production model after the G3 SUV and the P7 and P5 sedans, and is designed for both Chinese and international markets. 

G9 will be XPeng’s first model equipped with XPILOT 4.0, the company’s advanced driver -assistance system, or ADAS. It will also use NVIDIA’s Orin-X autonomous driving chip. In addition, G9 is built on XPeng’s new proprietary X-EEA 3.0 electronic and electrical architecture, a platform deeply integrating hardware, software and communications architecture to achieve greater powerful performance, and high flexibility. The X-EEA 3.0 consists of a centralised super-computing platform and local control modules. At the software level, the vehicle software suite has been structured in layers for faster development and iteration of different functions for better performance. 

With a strong innovative lead in the industry, existing model P7’s outstanding performance, and future G9 model’s extraordinary features planned, XPeng is well-deserved for it’s “Outperform”. 

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