Citi forecasts that by September-end, BYD’s dealer inventory in mainland China will fall to 1.6 months (versus 2.2 months in July and 1.9 months in August).
On October 9, Citi released a research note indicating that BYD’s inventory reduction efforts are yielding results.
The report notes that by September, BYD’s absolute and relative inventory metrics both fell month-on-month. Citi projects that ahead of new model launches in early 2026, BYD will continue to reduce stock levels, possibly lowering inventory to around one month by end-March 2026—a 50% YoY reduction.
Citi argues BYD’s de-stocking pace aligns with typical industry cycle adjustments. In the short term, Citi remains optimistic about the automotive sector’s beta through the end of October.
In the medium term, if BYD’s export mix improves significantly in Q1 2026, then post de-stocking, its relatively defensive margin profile and cost advantages over peers may help it regain market attention. Citi maintains a “Buy” rating on BYD H-shares, with a target price of HK$174 ($22.4).
Citi forecasts that by September-end, BYD’s dealer inventory in mainland China will fall to 1.6 months (versus 2.2 months in July and 1.9 months in August). For Q3, BYD’s net profit (excluding BYD Electronics) is estimated at RMB 5–6.2 billion.
On sales, BYD saw a slight dip in September. BYD reported NEV sales of 396,300 units in September, down 5.52% YoY. For January–September 2025, cumulative sales reached 3.26 million units, up 18.6% YoY; overall NEV sales have exceeded 13.8 million units.
Passenger vehicle sales in September were 393,000 units: the Dynasty and Ocean series together accounted for 356,000, with Yangwang at 758 units and Denza (Fangchengbao) contributing 24,000.
On the export front, BYD exported 71,300 NEVs in September. Of those, 70,900 were passenger cars and pickups—up 107% YoY—providing key support for BYD’s total September sales.
On the production and supply side, BYD installed about 23.2 GWh of powertrain and energy storage batteries in September, bringing its 2025 cumulative installed capacity to about 203 GWh.
In the domestic market, BYD’s September local sales reached 325,400 units, up about 11.1% month-on-month but down about 15.8% year-on-year. As Q4 unfolds—with new model launches and further expansion of overseas channels—whether BYD can recapture growth remains to be seen.
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