People look at a Tesla car at a showroom in Beijing.Wang Zhao | AFP | Getty ImagesTracking sales in China can often be opaque but one analyst believes data on automotive insurance registrations reveals that Tesla has strong demand in the key market.”Tesla’s deliveries to real, actual people are still rising at a triple-digit pace, despite being hamstrung by import duties, a flagging auto market, and a historical inability to tap EV subsidies,” Piper Jaffray analyst Alexander Potter wrote in a note to investors on Thursday.Potter’s research found that electric vehicle sales in China are increasingly made by unidentified “mystery buyers,” as well as fleets. However, in sales to actual Chinese consumers, Pipper Jaffray says Tesla has been steadily increasing its market share.The firm estimates Tesla’s third quarter deliveries – a closely watched measure of the company’s sales – in China are up more than 175% compared to the same period last year. Potter noted that insurance registrations are an imperfect way to calculate Tesla deliveries but defended it as a method, saying it still helps track demand.Tesla shares rose 0.3% in trading from its previous close of $228.70 a share. Piper Jaffray has an overweight rating on Tesla with a $386 price target.Most of the growth in China is being driven by the company’s cheaper Model 3, Potter said, while deliveries of the higher profit margin Model S and Model X vehicles “have actually declined by nearly 25%” year-over-year for the months of July and August. Despite that drop, Piper Jaffray remains optimistic about Tesla’s future in China.”Tesla’s Shanghai facility should be operational in the next few months/quarters, and once it opens, margins should rise,” Potter said. “Even in a market like China, where EV models are commonplace … Teslas are among the only electric vehicles (EVs) that consumers actually want to buy.”Baird analyst Ben Kallo similarly noted that Tesla’s factory in Shanghai factory is on track to begin making Model 3 vehicles by the end of this year.”We think TSLA has been able to leverage lessons learned at Fremont and Gigafactory 1 to optimize the ramp of G3 in Shanghai; it took only ~9 months to construct, ahead of guidance,” Kallo said.Kallo also pointed out that the production of both vehicles and batter packs at the Shanghai facility would help limit any possible impact from the ongoing trade war on Tesla. Baird has an outperform rating on Tesla, with a price target of $355 a share.Tesla expected to report third quarter deliveries late next weekElon Musk’s electric automaker is expected to report third quarter deliveries on Oct. 3, a metric Wall Street is closely watching ahead of Tesla’s earnings.RBC Capital Markets raised its estimate for Tesla’s third quarter deliveries to a total of 97,200, from its previous forecast of 86,300. RBC, which has an underperform rating and $190 price target on the stock, believes stronger than expected sales in Europe are helping Tesla this quarter.”We believe expectations for 3Q19 deliveries have come up, but a print [over 100,000] (which TSLA needs to average over [the second half of 2019] to hit low-end of guidance) should be well received when deliveries are reported within the first 3 days of October,” RBC analyst Joseph Spak said on Wednesday. “However, we continue to believe valuation is stretched with a lot of good already baked in.”Kallo said Baird believes the company is setup to surprise to the upside this quarter. The firm believes Tesla may even report a new quarterly record for deliveries, above the 95,200 cars it delivered in the second quarter.”We think expectations are low and believe shares could react positively if the company achieves sequential growth in deliveries (~95k +),” Kallo said.Credit Suisse stuck to its below average estimate of 84,000 deliveries for the third quarter but said in a note on Thursday that it would not be surprising to see Tesla report strong numbers.”That said, even if it meets consensus on deliveries, the question into 3Q EPS will be around margins + how the stock reacts with likely the first negative y/y revenue growth quarter since 2012,” Credit Suisse analysts Dan Levy and Robert Moon said.Credit Suisse has an underperform rating on the stock with a $189 price target.– CNBC’s Michael Bloom contributed to this report.