Research Note

"Looking ahead, we could envision a re-rating upward of China EV stocks given the large discount relative to US peers," said Deutsche Bank analyst Edison Yu's team.

"Fitch believes the prospects for China's EV market are bright, given still-strong demand," the credit rating firm said.

Edison Yu's team does not expect raw material price increases to have a materially negative impact on EV demand, considering that many ICE vehicle prices are also rising.

Edison Yu's team sees the narrative for Nio shifting from supply constraints to a product super cycle, reiterating that the company is their top pick in the Chinese EV industry this year.

Xpeng delivered mixed fourth-quarter results along with guidance that appears somewhat conservative, according to Deutsche Bank analyst Edison Yu's team.

Nio reported mostly uneventful 4Q results and provided in-line 1Q guidance, Deutsche Bank analyst Edison Yu's team said.

Deutsche Bank analyst Edison Yu's team lowered their price target on Nio from $70 to $50, maintaining a Buy rating.

The team gave Nio shares traded in Hong Kong a six-month price target of HK$200 ($25.6), implying a 38 percent upside.

The Li Auto L9 and Li ONE are ushering in a new category of "luxury cars for the family" that deserves a lot of attention, according to a team of local analysts.

Last week, some entities chose to "be first" and this may have turned into a fire sale where institutional shareholders simply have given up on China ADRs as an asset class.