Analysis of Seres' Potential for 'Turnaround from Adversity' Amid New Energy Sector Decline

I will systematically address your core question—whether Seres can achieve a ‘turnaround from adversity’ amid the overall decline of the new energy sector—from five aspects: stock price and valuation, financial fundamentals, business and competitiveness, sector and capital dynamics, and risks and strategies.

1. Stock Price and Valuation: Recovery Space and Safety Margin

• Latest price: 120.99 yuan (+0.27%), market capitalization of approximately 197.6 billion yuan; year-to-date high of 174.66 yuan, with a notable pullback from the year’s peak.
• Valuation: PE(TTM) of about 27.37x, in the mid-to-low range of the industry; the historical annual line has declined by nearly 10 percentage points, reflecting weak capital sentiment [Brokerage API Data].
• Technical aspect: Medium-term stock price is below the 50-day (≈134 yuan) and 200-day (≈134 yuan) moving averages, with a sideways technical pattern. Support at around 119.56 yuan, resistance at around 122.63 yuan [Brokerage API Technical Analysis].
• Target price: Average institutional target price of approximately 157.96 yuan (from multiple brokerages), representing a potential upside of about +30.9% from the current price, reflecting medium-to-long-term recovery expectations [Web Search].
• Summary: Valuation safety margin and recovery space coexist, but capital and technical factors are needed to form a trend.

2. Financial Fundamentals: Profitability and Performance Resilience

• Performance: Latest quarterly revenue and EPS significantly exceeded expectations (revenue 48.13B vs expected 27.57B; EPS 1.45 vs expected 0.0155), verifying scale effects and high-end profit contributions [Brokerage API Data].
• Profit quality: H1 gross margin rose to 28.93%, H1 net profit attributable to parent company increased by 81% YoY, ROE of about 32%, net margin of about 4.8%, indicating improved efficiency in converting sales volume to profits [Brokerage API Financial Data].
• Cash flow and leverage: Free cash flow turned positive, liquidity indicators marginally improved; overall financial health ranks above average in the industry [Brokerage API Financial Analysis].
• Summary: Profitability and financial quality form the performance foundation for a ‘turnaround from adversity’, with stable profit expectations for Q4 and 2025.

3. Business and Competitiveness: High-endization, Intelligence, and Internationalization

• Sales structure: Cumulative sales from January to November reached 411,000 units (+49.8% YoY). Aito M9 cumulative deliveries exceeded 260,000 units, M8 exceeded 130,000 units, and the new Aito M7 received over 90,000 pre-orders within 41 days of launch. The high-end model matrix drives average price and profit margins [Web Search and Sales Data].
• Technology and intelligent driving: Leading layout in intelligence (ADS3.0, HarmonyOS Cockpit) and L3 technology under the collaborative ecosystem, benefiting from the advancement of first-batch L3 vehicle access policies [Web Search].
• Capacity and overseas expansion: Completed A+H dual listing, HKEX IPO net proceeds of approximately HK$14 billion, with 70% planned for R&D; overseas expansion focuses on the Middle East and Europe, supported by channel and localization布局 [Web Search and Company Materials].
• New business: Layout in embodied intelligence directions such as robotics with ecosystem synergy, expected to form a second growth curve in the long term [Web Search].
• Summary: High-endization and intelligence form competitive barriers; overseas expansion and new businesses provide medium-term growth momentum.

4. Sector and Capital Dynamics: Opportunities and Pressures Amid Rotation

• Sector performance: The new energy vehicle sector has recently corrected, with capital flowing to commercial aerospace and PCB sectors阶段性 [Web Search Sector].
• Industry trends: Industry competition pattern is accelerating differentiation; price wars and subsidy retreat put pressure on small and medium-sized automakers to exit; profitability becomes the key to success [Web Search Industry].
• Macro and policies: Expectations for the continuation of the 2026 ‘New National Subsidy’ are stable, but the intensity and implementation effect need to be observed; tariffs and carbon border adjustment mechanisms pose both challenges and opportunities for overseas expansion [Web Search Policies and Overseas Expansion].
• Summary: Weak sector sentiment suppresses valuation, but industry exit and concentration improvement benefit leading players.

5. Risks and Strategies: Time Dimension and Recommendations

• Main risks: Intensified industry price wars, high-end demand falling short of expectations, geopolitical and compliance risks for overseas expansion, and valuation pressure from sustained sector capital rotation.
• Strategy Recommendations:
  • Long-term fundamental investors: Phased layout at relatively reasonable valuation ranges (support around 120 yuan), focusing on profit realization and overseas capacity release in the medium term;
  • Short-term traders: Monitor trading volume and technical breakthrough signals, wait for sector capital inflow and policy catalysts;
  • Risk control: Set reasonable stop-loss and position management to cope with industry volatility and macro uncertainty.

Conclusion and Judgment:

• Seres has medium-term potential for a ‘turnaround from adversity’: Stable performance and fundamentals, high-end products and technology forming barriers, overseas expansion and R&D supporting growth, and considerable valuation recovery space.
• Short-term (several months) is still constrained by sector capital rotation and technical volatility; may need to wait for sustained performance verification and sector sentiment recovery;
• Medium-term (6-12 months) is expected to stage a recovery driven by profit realization, order and capacity landing, overseas expansion, and new product cycles, with the target price referencing the institutional average of around 158 yuan.
• Key Observations: Q4 and 2025 order and delivery status, high-end model market share, overseas channel and factory progress, policy implementation pace.

(Note: The above analysis is based on available market, financial, and industry data and does not constitute investment advice. Please make independent decisions based on your own risk preference.)

[0] Jinling API Data
[1] Economic Reference Network - Seres’ Sales and Capital Double Success: High-end Strategy Initially Shows Profit Effect
[2] NetEase - Aito M9 Deliveries Exceed 260,000 to Lead High-end Market; Seres Starts New Journey with Capital Benefits
[3] Xinpai Network - Seres New Energy Vehicle Monthly Sales Exceed 50,000 Again, Up 50% YoY; Aito Continues to Lead High-end Market
[4] Eastmoney.com - [ETF Strategy Weekly] New Energy Sector Tracking: Energy Storage Demand Remains Strong, ‘Anti-involution’ Continues to Advance
[5] Caifuhao - 2026 ‘New National Subsidy’ Invests 500 Billion! Will New Energy Vehicle Replacement Change?
[6] Gasgoo - The Frenzy, Shuffle, and Breakthrough of Intelligent Driving | Seeing 2025
[7] Industry views from Deutsche Bank and JPMorgan cited from self-media collated reports - Subsidy Exit, Demand Freeze: 50 Chinese EV Makers May Exit Collectively in 2026