Meidong Motor (01268) rose 8.8 in early trading200freespinsnodeposit.07%, currently quoted at HK$3.08, with a turnover of HK$24.103 million.

Zhongtai Securities pointed out that the company is strong200freespinsnodepositThe after-sales business performance of the company hedged the decline in the gross profit of some new car sales. The company's full-year after-sales service gross profit margin in 2023 was 53.7%, a year-on-year increase of 4.7 percentage points. In addition, the company remains the fastest-turnover company in the industry. In 2023, the number of inventory days in the U.S. East will be 12 days, which is the same as in 2022. A faster turnover speed can ensure the stability of the company's cash flow, and a stronger cash reserve can help the company weather the crisis. As of the end of 2023, the company's cash reserves were 2.4 billion yuan.

On the expense side, the proportion of the company's main expenses to revenue in 2023 will decrease by 0.1 percentage points year-on-year to 6.7%. The increase in after-sales gross profit fully covers the company's main expenses, and the company's zero-service absorption rate will increase from 84.6% in 2022 to 116.7% in 2023. This means that even if the company does not sell a single car, it can still ensure survival and maintain operations. The bank believes that efficient and stable operations are expected to turn crisis into opportunity and maintain its "overweight" rating.