Fuyao Glass Industry (3606 HK/600660 CH): Buy/Buy: Weak auto beta priced in; recovery ahead

研报英文原文证据摘录

Fuyao Glass Industry (3606 HK/600660 CH): Buy/Buy: Weak auto beta priced in; recovery ahead

22 July 2026

Fuyao Glass Industry Equities Auto Components

(3606 HK/600660 CH)

Buy/Buy: Weak auto beta priced in; recovery ahead China

◆ Weak auto beta is largely priced in after YTD correction H: MAINTAIN BUY

◆ Fundamentals should improve in 2H26, with valuation

remaining compelling TARGET PRICE (HKD) PREVIOUS TARGET (HKD)

87.40 91.20

◆ Maintain Buy/Buy for A/H shares, with target prices cut to

RMB83.30/HKD87.40, from RMB92.20/HKD91.20 SHARE PRICE (HKD) UPSIDE/DOWNSIDE

55.45 +57.6%

The correction largely prices in the weak auto beta. The company’s A/H shares (as of 20 Jul 2026)

have corrected 15%/17% YTD (vs. CSI300 -2% and HSCI -7%), primarily reflecting A: MAINTAIN BUY

the weak beta of China’s auto sector (6M26 domestic wholesales -6% YoY; Wind

Auto Index -26% YTD). As the domestic auto market enters its seasonally stronger TARGET PRICE (CNY) PREVIOUS TARGET (CNY)

second half, we expect both auto demand and sector sentiment to improve. 83.30 92.20

Fundamentals should improve from hereon. Despite operating within a weak auto

backdrop, the company continues to demonstrate defensive earnings characteristics SHARE PRICE (CNY) UPSIDE/DOWNSIDE

through: 1) ongoing domestic ASP expansion (supported by higher glazing content 54.94 +51.6%

from vehicle intelligence upgrades and a richer product mix); 2) further overseas (as of 20 Jul 2026)

market share gains amid overseas competitor contraction. Meanwhile, cost concerns

MARKET DATA

from soda ash, shipping costs, and energy prices triggered by elevated oil prices in BBG / RIC 3606 HK / 3606.HK

1H26, should gradually stabilize going into 2H26. Furthermore, utilisation at the new Market cap (HKDm / USDm) 161,157 / 20,553