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Leapmotor (SEHK:9863) Stock Profit Turn Meets Lofty P/E Questions

Simply Wall St · 2d ago

Zhejiang Leapmotor Technology stock came into the earnings print with a mixed tape, down about 3% over the past week but still up around 11% over the past month. That backdrop matters because the headline from this report is clear. The company is now showing meaningful profit on fast growing electric vehicle volume, yet the shares still trade on a very rich trailing P/E of 68.9x.

The sentiment test for you is simple. Are investors paying up for real earnings momentum or reacting emotionally to a high multiple on a story that has just turned solidly profitable over the last twelve months?

Love Zhejiang Leapmotor Technology’s move into meaningful profit but concerned about paying a 68.9x trailing P/E for that story? Take a look at our 292 resilient stocks with low risk scores for alternatives that combine earnings delivery with more moderate risk profiles.

H1 2026 Earnings Summary

  • Total Revenue H1 2026 vs H1 2025: CNY 38,106.55m vs CNY 24,249.60m (up about 57%)
  • Net Income H1 2026 vs H1 2025: CNY 208.41m vs CNY 33.03m (very strong improvement from a low base)
  • Basic EPS H1 2026 vs H1 2025: CNY 0.1466 per share vs CNY 0.0243 per share (sharp increase)
  • Gross Profit Margin H1 2026: 11.7% for the half year, with Q2 margin at 12.6% (management indicates focus on gradual margin improvement)

Prefer clean charts instead of another wall of earnings tables and ratio math? See Zhejiang Leapmotor Technology’s full valuation picture at a glance in our company report for Zhejiang Leapmotor Technology.

SEHK:9863 Trailing 12-Month Earnings & Revenue History as at Aug 2026
SEHK:9863 Trailing 12-Month Earnings & Revenue History as at Aug 2026

Zhejiang Leapmotor’s Growth Story Meets Concrete Milestones

Bulls argue Zhejiang Leapmotor Technology can turn rapid NEV expansion, globalisation and in house tech into a structurally stronger business. H1 2026 results give you real checkpoints on that story. Deliveries reached 356,000 units with exports at 96,294 units. July exports passed 17,000 and Leapmotor now has more than 1,000 overseas stores and local assembly underway in Malaysia. That is tangible progress toward the overseas scale the Stellantis partnership is meant to unlock, supported by the Röchling supply deal for Europe and the Spain plant that is moving toward start up.

On earnings quality, revenue of CNY 38.11b with H1 net profit of about CNY 210m and an 11.7% gross margin shows the move from volume only to profitable scale is underway, even after management cut full year profit expectations. The bullish narrative about multi platform rollout and Tier 1 technology monetisation now has early, but incomplete, proof points.

Reveal whether Zhejiang Leapmotor Technology’s shift to positive net profit, rising gross margin and overseas volume progress has analysts raising or cutting their expectations. Compare that earnings story with the consensus price target analysis for Zhejiang Leapmotor Technology.

Bear Worries On Profit Quality Largely Intact For Zhejiang Leapmotor

The bearish view on Zhejiang Leapmotor Technology focuses on fragile profit quality and heavy reliance on volume and carbon credits rather than durable vehicle margins. The latest numbers only partly reduce those concerns. Yes, H1 2026 delivered CNY 210m of net profit and 11.7% gross margin, with vehicle gross margin around 10 to 11%. However, management cut full year net profit guidance from CNY 5b to about CNY 3b and now guides only 13 to 14% gross margin. That reset supports the fear that earnings are highly sensitive to raw material costs and pricing pressure.

Bears also point to dependence on carbon credit income and high spend to support overseas push. H1 carbon credit revenue of about CNY 800 to 900m is material versus net profit, while free cash flow fell to CNY 140m from CNY 860m. Those milestones missed keep questions around earnings durability very much alive.

With free cash flow already down sharply versus last year, can Zhejiang Leapmotor Technology really fund overseas expansion and margin targets without stressing its balance sheet? Check the full solvency and liquidity breakdown in our financial health analysis of Zhejiang Leapmotor Technology stock.

Stay Ahead Of Your Next Move

If Zhejiang Leapmotor Technology’s shift to positive net profit and the rich 68.9x trailing P/E has your attention, register for free with Simply Wall St and add it to a Watchlist to track the share price against fair value and watch for your preferred entry point. After you decide to buy or sell, keep on top of position level alerts and key developments through your personalized Portfolio Command Center. For a broader view on sentiment and potential catalysts, tap into thousands of investor viewpoints inside the Community. Spotting emerging risks and opportunities early can help you stay ahead of the market instead of reacting to it.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.