Strong Mona L03 orders support accelerated sales growth for XPeng

Overview

This report focuses on XPeng's order performance following the Mona L03 launch, product competitiveness, new model cycle, and overseas expansion. Goldman Sachs believes the Mona brand has established a differentiated position in the mass market, and as an SUV model covering a broader market, the Mona L03 will drive faster sales growth over XPeng's next three quarters and improve visibility on revenue growth and margin improvement.

Core views

Goldman Sachs' core view is that XPeng's new model cycle is becoming a key driver of sales recovery and accelerating growth. GX was launched in May and received nearly 25k non-refundable orders, while Mona L03 orders were notably strong after its July launch. The subsequent Mona L05 and G9L are expected to further lift average monthly sales in 4Q26E to above 60k units. Goldman Sachs continues to forecast 20% revenue growth in 2026E, full-year sales of about 500k units, up 16% year on year, overseas revenue contribution above 20%, and a slight improvement in gross margin to 19.1%.

Analysis framework

The report combines order tracking, model launch cadence, product peer comparison, sales forecasts, overseas strategy assessment, and DCF valuation. Product comparison mainly centers on new energy sedans and SUVs in the Rmb100k-150k price range, assessing the relative competitiveness of Mona M03, Mona L03, and peers across dimensions such as price, range, size, and intelligent driving features.

Methodology notes

• Valuation methodsDCF

  12-month target price

  Goldman Sachs uses the DCF method to derive a 12-month target price, assuming a WACC of 11.8% and a TGR of 3.0%, resulting in target prices of US$23 for XPEV ADR and HK$89 for 9868.HK.

• Product comparisonNew energy vehicle peer scoring

  Comparison of price, range, size, and intelligent driving features

  The report compares new energy sedans and SUVs in the Rmb100k-150k range, and believes Mona M03 ranks first in sales among new energy sedans at this price point, while Mona L03 BEV/EREV ranks near the top among SUVs at the same price point, especially the EREV version.

• Stock attributesGS Factor Profile

  Growth, Financial Returns, Multiple, Integrated

  Goldman Sachs' factor framework compares stocks on a relative basis using growth, financial returns, valuation multiples, and integrated indicators, with metrics based on analyst forecasts and standardized rankings within the coverage universe.

Asset mapping & comparison

Structured mapping from thesis to named assets (strengths, weaknesses, peers, risks).

• XPeng Inc. (9868.HK)

  Primary covered H-share target

  Strengths

  Buy rating, target price of HK$89, current price of HK$52.55, implying 69.4% upside; benefits from a new model cycle consisting of Mona L03, GX, Mona L05, and G9L.

  Weaknesses

  2026E operating profit is still expected to be Rmb-2.8bn, and the earnings recovery remains in the validation stage.

  Comparison

  Compared with peer new energy SUVs in the Rmb100k-150k range, Mona L03 is competitive in range and size; Mona M03 ranks first in sales among new energy sedans at the same price point.

  Risks

  Sales below expectations, worsening price competition, and weaker-than-expected market demand.

• XPeng Inc. (XPEV ADR)

  ADR of the same company

  Strengths

  Buy rating, target price of US$23, current price of US$13.78, implying 66.9% upside; shares the same new vehicle cycle and overseas expansion thesis for XPeng.

  Weaknesses

  Valuation and performance remain affected by competition in China's new energy vehicle industry, delivery cadence, and global market risks.

  Comparison

  Mapped to the same fundamentals as the H-share, with the report providing target prices for both the ADR and H-share.

  Risks

  Sales below expectations, worsening price competition, and weaker-than-expected market demand.

Key data

• Official starting price of Mona L03Rmb123.8kGlobal launch price on July 16, below the pre-sale starting price of Rmb143.8k.
• Post-launch orders for Mona L0320k/47k non-refundable orders in 7 mins/1 hourThe order pace was stronger than the 10k/30k non-refundable orders during the initial launch phase of Mona M03.
• Forecast stable monthly sales of Mona L0314k unitsGoldman Sachs expects it to contribute 22%/23% of XPeng's total sales in 3Q26E/4Q26E.
• 2026E sales forecast500k units, +16% yoyDriven jointly by domestic new model launches and overseas expansion.
• 2026E revenue growth forecast+20%Overseas revenue is expected to contribute more than 20% of total revenue, and overseas sales are expected to double.
• 2026E gross margin forecast19.1%Above 2025E's 18.9%, supported by economies of scale and a higher contribution from overseas sales.
• 2026E R&D expense forecastRmb12bnOf which physical AI investment is expected to be Rmb7bn.
• 12-month target price and upsideHK$89/US$23; upside 69.4%/66.9%Corresponding to 9868.HK and XPEV ADR, respectively.

Impact & implications

If Mona L03 orders can convert into stable deliveries, XPeng's sales recovery may expand from improvement driven by a single model to a cycle driven by multiple models. Progress in overseas expansion, localized R&D and production in Europe, humanoid robots, and Robotaxi further strengthens the long-term growth narrative, but the near-term investment view still mainly depends on new vehicle orders, delivery ramp-up, price competition, and gross margin realization.

Risks

• Sales below expectations, especially if orders for Mona L03, GX, Mona L05, and G9L convert to deliveries less successfully than expected.
• Price competition may be more severe than expected, squeezing gross margin and the scope for earnings improvement.
• Market demand may be weaker than expected, affecting both domestic and overseas sales growth.
• There is uncertainty around the implementation pace of long-term projects such as overseas expansion, localized production, Robotaxi, humanoid robots, and flying cars.

What to watch

• Follow-up order updates and delivery ramp-up for Mona L03.
• Weekly order trends and monthly sales trends.
• Humanoid robot showcase in 3Q26.
• Launch of Robotaxi pilot passenger operations in 3Q26.
• Launches of Mona L05 and G9L in 4Q26.
• Share of overseas revenue, European localization strategy, and progress in entering 65 global markets.