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Are NIO, LI & XPEV Worth the Wager Post Q2 Results?

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Not too long ago, Tesla TSLA was the only notable name in the electric vehicle (EV) space. Nevertheless, over the last couple of years, considering heightening climate concerns and Tesla’s massive success, legacy automakers have started pouring billions of dollars to electrify their portfolio. Pure-play EV startups have also been on the rise as investors seem to be intrigued by automakers who are fast changing their gears to electric.

Among the nations, China is the world’s biggest EV market that is currently backed by government stimulus measures and advancement of the EV charging infrastructure owing to state-of-the-art technologies. Importantly, the country projects EVs to account for 25% of new car sales by 2025, as opposed to just around 5% currently. China Passenger Car Association projects new energy vehicle sales in the country to hit 2.4 million units this year, indicating an increase from around 1.3 million units in 2020.

Amid this booming e-mobility landscape in the nation, let’s see how the popular China-based EV players including NIO Inc. NIO, Li Auto LI, and XPeng XPEV are faring. Each of these three EV makers posted improved year-over-year results for second-quarter 2021. But are these stocks attractive investment options at the moment?

NIO, being dubbed as the “Tesla of China”, is indeed a more popular name when it comes to China-based EV makers. ES6, ES8, and EC6 models are enhancing the firm’s prospects. Next year, the firm intends to deliver three new products based on NIO Technology Platform 2.0, including the ET7 model. We like the firm’s battery swapping technology, expansion efforts, and efforts to make headway into autonomous driving. NIO has taken the driverless technology game a notch higher with the Aquila NAD (NIO Autonomous Driving) system.

Li Auto and XPeng are touted as the rising stars of China’s EV industry. Both the companies went public two years later than NIO. Li Auto debuted on Nasdaq on Jul 30, 2020, becoming the second China-based EV maker to be listed on the U.S. stock market after NIO. XPeng made its debut on the U.S. stock market on Aug 27, 2020.

Li Auto currently has only a single offering, an e-SUV named Li One, which is equipped with an onboard........

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