Great Wall Motor (GMW)’s 1Q15 results were moderately (~5%) above ourforecasts. Although the stock's remarkable rally (e.g. ~80% in six months or ~30%YTD for both H and A shares vs MSCI China Auto Index up ~28%/30% in sixmonths/YTD) might prompt investors to consider taking profit, we recommendholding on to long positions through its aggressive, and thus far very successful,model cycle. We lift our earnings forecasts by 4% and PT to HK$66/Rmb62. Why can the stock go higher? We upgraded GWM to OW in Oct-14 (clickhere) on the belief that the sales performance of its high-end SUV (e.g. H9)would beat market expectations, whilst the company’s aggressive model cyclewould further boost its earnings and eventually drive the stock's multiple. YTDconsensus FY15 estimates have been raised by 10%, while the 12-monthforward PER of the H-shares, for instance, also expanded from 9x in Jan-15 tothe current 11x based on our analysis. Despite this, we anticipate there is moreto go because:1.From a top-down view, we believe the SUV segment will continue to enjoysuperior growth in China until penetration hits or exceeds 30% (vs current25%). GWM is best positioned to benefit from this secular boom, given itshighest concentration (>95% of revenue) in SUV across all OEMs. 2. GWM’s comprehensive model portfolio and cycle (Table 3), plus value for moneymodels, suggest rivals, foreign or local, may not catch up anytime soon. This isbest proven by the negligible discount (1.4%) of its most popular SUV, H6-despite it entering the fifth year of model cycle. 1Q15 earnings up 26% yoy: We summarize the results call in this report. Rating, risks: We retain OW on H/A share with new Dec-15 PT of HK$66/Rmb62 (from HK$60/Rmb56) based on 13.5/15x forward PER, respectively. Risks: worse than expected sales and margins.

3Q10 results summary: Anhui Conch reported its 3Q10 results today,~10% ahead of our forecast and largely in line with consensus. Accumulated PAT after minority is Rmb3,159mn (41% growth) onrevenue of Rmb22,358mn (27% growth). Gross margin was sustained at26.7% by 3Q10, up rom 24.9% in 1H10 and versus our full yearestimate 27%. EPS for the year through Sep. is Rmb0.89/shr. First take on 3Q10 results: Conch did not disclose any operatingstatistics in 3Q10 results (e.g. sales volume, capacity, per tonnage profitor ASP) and only released limited financial results. Both gross marginand Opt. margin are broadly in line with our expectation; our tax rateforecast (18%) is however slightly lower than actual results (19.7%) in3Q10. Leverage measured by net debt to equity dropped slightly to 37%by 3Q10 from 41% in 1H10. ROE in 1Q-3Q10 is 12.6% (not annualized)vs. our full year forecast of 13.6%. PT, risks: We maintain Neutral rating on Conch-H and OW on Conch-A unchanged at this stage, with Jun-11 PT Rmb/HK29, based on LTmid-cycle average 2.9x PB. Historically, Conch is largely tradingbetween 2-5x forward P/B. We believe a mid-cycle average is reasonableconsidering demand/supply environment and pricing outlook in Chinamarket in 2011.l Risks to our analysis lies in worse than expecteddemand and overcapacity in China cement market, and Conch’s earningsgrowth in 2010/11. We will discuss with management on the company’s3Q10 results tomorrow and obtain further operating statistics beforemaking any adjustment to our forecast.