Group 1 - Xiaomi plans to sell its electric vehicles (EVs) outside of China within the next few years, indicating its ambition to compete in the global EV market against established players like Tesla [2] - The company launched its first luxury EV, the SU7 Ultra, in China, priced at 529,000 Chinese yuan (approximately $72,627), and received 15,000 orders within 24 hours of its launch [3] - The announcement was made by Xiaomi's President William Lu during the Mobile World Congress in Barcelona, highlighting the company's excitement about expanding its EV offerings to global markets [2][3] Group 2 - The SU7 Ultra will be officially launched on the evening of February 27, 2025, and will be showcased at Xiaomi's booth at the Mobile World Congress [1][3] - While specific timelines for international sales were not provided, the comments from the company reflect a strategic move to enhance its presence in the competitive EV landscape [2]

Core Insights - Xiaomi is successfully transitioning to premium devices, targeting affluent European consumers, as it aims to compete with market leader Samsung [1][3] - The Xiaomi 15 and Xiaomi 15 Ultra smartphones feature Qualcomm's Snapdragon 8 Elite Mobile Platform, with prices starting at 999 euros ($1,047) and 1,499 euros ($1,571) respectively [2] - In 2024, Xiaomi's global smartphone shipments increased by 15.4% year-on-year, raising its market share to 13.6% from 12.5% in 2023 [3] Company Strategy - Xiaomi began in 2010 with low-to-mid price smartphones and has since expanded internationally, focusing on the European market [4] - The company has diversified its portfolio to include connected devices and recently entered the electric vehicle market with the SU7 [5] - The electric vehicle initiative is enhancing Xiaomi's brand perception, leveraging the innovation associated with automotive development [5][6] Market Performance - Xiaomi's stock has surged nearly 300% in the past year, driven by a recovery in the smartphone sector and the success of its electric vehicle [6] - The company's shares reached a record high recently, with expectations to maintain momentum through new smartphone launches and the SU7 Ultra electric car [7] Competitive Landscape - Xiaomi faces significant competition in the premium smartphone market, particularly from Samsung and other Chinese brands like Oppo and Honor [7][8] - The premium smartphone segment is becoming increasingly crowded, making it challenging for Xiaomi to gain market share from established players [8]

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Group 1 - Xiaomi Group's stock price reached a new high of 50.9 HKD, with a market capitalization of 1.27 trillion HKD, before experiencing a slight decline [1] - The company's market value surpassed 1 trillion HKD in early February, entering the global top 100 by market capitalization, compared to around 12 HKD at the beginning of 2024 [1] - The focus remains on Xiaomi's mobile and automotive businesses, with upcoming product launches generating significant market interest [1] Group 2 - Xiaomi's CEO Lei Jun indicated that the new Xiaomi 15 Ultra will likely see a price increase due to rising R&D and component costs, with the previous model priced at 6499 RMB [2] - Several financial institutions have maintained a "buy" rating for Xiaomi, with target prices ranging from 38 to 57.74 HKD, indicating a bullish outlook [2] - Citigroup has removed Xiaomi from its "most buyable" list following the stock's recent rise, while also adjusting the Hang Seng Index targets upward [2] Group 3 - Analysts express a significant divergence in Xiaomi's valuation, suggesting that the stock may already reflect future earnings, and comparisons are being made to the past performance of leading new energy vehicle companies [3] - Future performance will depend on Xiaomi's hardware gross margins and the profitability contributions from its ecosystem companies [3]

Investment Rating - The investment rating for the company is maintained as "Buy" with a target price of 57.74 HKD [4][10][7]. Core Views - The company is expected to achieve earnings per share of 0.84, 1.06, and 1.37 CNY for the years 2024, 2025, and 2026 respectively, reflecting an upward adjustment in revenue and gross margin forecasts due to the positive industry outlook and the company's strategic initiatives [4][10]. - The automotive segment has shown strong performance with monthly deliveries exceeding 20,000 units, maintaining a long delivery cycle of 6-7 months [9][10]. - The integration of the DeepSeek large model into the company's operating system enhances its AI capabilities, allowing for various applications such as code writing and logical reasoning [9][10]. Financial Summary - Revenue projections for 2024, 2025, and 2026 are 362,463 million CNY, 406,553 million CNY, and 475,075 million CNY respectively, indicating a growth rate of 34%, 12%, and 17% [6][10]. - Operating profit is forecasted to be 22,944 million CNY, 29,430 million CNY, and 38,863 million CNY for 2024, 2025, and 2026, with significant growth rates of 15%, 28%, and 32% [6][10]. - The net profit attributable to the parent company is expected to reach 20,996 million CNY, 26,528 million CNY, and 34,418 million CNY for the same years, with growth rates of 20%, 26%, and 30% [6][10]. - The gross margin is projected to be 21.0%, 21.8%, and 22.7% for 2024, 2025, and 2026, while the net margin is expected to be 5.8%, 6.5%, and 7.2% [6][10].

Investment Rating - The report maintains a "Buy" rating for the company [4][10][7] Core Insights - The company is projected to have earnings per share of 0.84, 1.06, and 1.37 RMB for the years 2024, 2025, and 2026 respectively, with adjustments made to revenue and gross margin forecasts [4][10] - The target price is set at 57.74 HKD based on a 39x PE valuation for comparable companies in 2026 [4][10] Financial Performance Summary - Revenue (in million RMB) is forecasted to be 362,463 in 2024, 406,553 in 2025, and 475,075 in 2026, reflecting growth rates of 34%, 12%, and 17% respectively [6] - Operating profit is expected to rise significantly from 20,009 million RMB in 2023 to 38,863 million RMB in 2026, with corresponding growth rates of 610%, 15%, 28%, and 32% [6] - Net profit attributable to the parent company is projected to increase from 17,475 million RMB in 2023 to 34,418 million RMB in 2026, with growth rates of 606%, 20%, 26%, and 30% [6] - The gross margin is expected to stabilize around 21.0% to 22.7% from 2024 to 2026 [6] Market Position and Product Performance - The company maintained its position as the third-largest smartphone vendor globally, with a market share of 13% in Q4 2024 and an annual shipment of approximately 169 million units [9] - The company has seen significant growth in its AIoT product categories, with notable increases in sales for various smart home appliances [9] - The automotive segment has delivered over 160,000 vehicles, maintaining a monthly delivery rate of over 20,000 units [9]

Investment Rating - The report maintains a "Buy" rating for Xiaomi Group [3][6]. Core Views - Xiaomi Group's smartphone shipments reached 42.7 million units in Q4 2024, marking a 4.8% year-on-year increase, with a global market share of 12.9%, positioning it among the top three manufacturers [1]. - In the Chinese market, Xiaomi's smartphone shipments grew by 28.4% year-on-year, driven by the success of the Xiaomi 15 series and local subsidies for high-end devices [1]. - The IoT business is expected to benefit from the 2024 appliance replacement subsidy policy, leading to significant revenue growth [2]. - The automotive segment delivered 135,000 units in 2024, with a target of 300,000 units for 2025, indicating strong growth potential [2][3]. Financial Summary - Revenue projections for 2024-2026 are estimated at CNY 362.9 billion, CNY 456.2 billion, and CNY 596.8 billion, representing year-on-year growth rates of 34%, 26%, and 31% respectively [3][11]. - Adjusted net profit for the consumer electronics segment is forecasted to be CNY 32.1 billion in 2025, with a growth rate of 10% [3][11]. - The automotive segment is expected to show a turnaround with an adjusted net profit of CNY 0.9 billion by 2026 [3][11]. - The report sets a target price of HKD 54 for Xiaomi Group based on a 20x P/E ratio for the consumer electronics business and a 2x P/S ratio for the automotive segment [3].

Investment Rating - The report maintains a "Buy" rating for Xiaomi Group [6] Core Views - Xiaomi Group is expected to achieve a total revenue of 105.4 billion RMB in Q4 2024, representing a year-on-year increase of 44% [1] - Non-IFRS net profit for Q4 2024 is projected to grow by 36% year-on-year to 6.7 billion RMB, with losses from innovative businesses like electric vehicles expected to decrease to around 900 million RMB [1] - The report anticipates strong performance in Xiaomi's core businesses, particularly in smartphones, IoT, and automotive sectors, leading to an upward revision of profit forecasts for 2024-2026 [5] Summary by Sections Revenue and Profit Forecast - Q4 2024 total revenue is expected to reach 105.4 billion RMB, a 44% increase year-on-year [1] - Non-IFRS net profit is projected at 6.7 billion RMB, a 36% increase year-on-year [1] - Revenue for 2024 is forecasted at 361.9 billion RMB, with a growth rate of 33.6% [10] Smartphone Business - Global smartphone shipments are expected to grow by 5% year-on-year to 42.7 million units in Q4 2024, with a significant 29% increase in shipments in China [2] - The average selling price (ASP) of smartphones is anticipated to rise due to government subsidies and the launch of the Xiaomi 15 series [2] - The smartphone business gross margin is expected to improve to around 12% in Q4 2024 [2] IoT and Internet Services - IoT revenue is projected to exceed 30 billion RMB in Q4 2024, a nearly 50% year-on-year increase, driven by government subsidies for home appliances [3] - Internet services revenue is expected to rise by 16% year-on-year to 9.2 billion RMB, marking a significant milestone of surpassing 9 billion RMB in a single quarter [3] Automotive Sector - The automotive gross margin is expected to approach 20% in Q4 2024, with deliveries of the SU7 Ultra model set to begin [4] - Xiaomi is projected to deliver over 135,000 vehicles in 2024, with Q4 deliveries estimated at 68,000 units [4] - The automotive business is expected to turn profitable in 2025, supported by improved production capacity and demand [4] Valuation and Profitability - The report revises the Non-IFRS net profit forecasts for 2024-2026 to 25.7 billion RMB, 41.0 billion RMB, and 56.7 billion RMB respectively, reflecting significant upward adjustments [5] - The adjusted P/E ratio is projected to decrease from 123 in 2022 to 19 in 2026, indicating improved valuation metrics [5]

Investment Rating - The report maintains a "Buy" rating for Xiaomi Group [3][6]. Core Views - Xiaomi Group's smartphone shipments reached 42.7 million units in Q4 2024, marking a 4.8% year-on-year increase, with a global market share of 12.9%, positioning it among the top three manufacturers [1]. - In the Chinese market, Xiaomi's smartphone shipments grew by 28.4% year-on-year, driven by the success of the Xiaomi 15 series and local subsidies for high-end devices [1]. - The IoT business is expected to benefit from the 2024 appliance replacement subsidy policy, leading to significant revenue growth [2]. - The automotive segment delivered 135,000 units in 2024, with a target of 300,000 units for 2025, indicating strong growth potential [2][3]. Financial Projections - Revenue projections for 2024-2026 are estimated at CNY 362.9 billion, CNY 456.2 billion, and CNY 596.8 billion, representing year-on-year growth rates of 34%, 26%, and 31% respectively [3][11]. - Adjusted net profit for the consumer electronics segment is projected to be CNY 32.1 billion in 2025, with a growth rate of 10% [3][11]. - The report anticipates a continued upward trend in IoT gross margins due to improvements in product quality and cost efficiency [2][3]. Market Performance - Xiaomi's stock closed at HKD 45.15 on February 17, 2025, with a total market capitalization of approximately HKD 1.13 trillion [6]. - The report sets a target price of HKD 54 for Xiaomi Group based on a 20x P/E ratio for the consumer electronics segment and a 2x P/S ratio for the automotive segment [3].

Group 1 - The core viewpoint of the report is that Huaxing Securities has upgraded Xiaomi Group to a "Buy" rating and significantly raised its target price to HKD 52.00 [1] - Xiaomi's revenue for the fourth quarter of last year is expected to exceed RMB 100 billion for the first time, reaching RMB 105 billion, a year-on-year increase of 40% [1] - Smartphone revenue is projected to be RMB 49 billion, with a 6% year-on-year increase in average selling price due to higher contributions from premium models [1] Group 2 - IoT revenue is expected to grow by 46% year-on-year to RMB 29.7 billion, benefiting from domestic stimulus policies [1] - Internet services revenue is anticipated to increase by 13% year-on-year to RMB 8.9 billion, with notable performance in electric vehicle deliveries and revenue [1] - Overall gross margin is expected to improve by 20 basis points quarter-on-quarter to 20.6% [1] Group 3 - Revenue and profit growth for Xiaomi in 2025 will be driven by three factors: national consumption subsidy policies, expansion of electric vehicle production capacity and introduction of new models, and the monetization of CEO Lei Jun's personal brand along with the implementation of Xiaomi's new retail strategy [1] - Based on higher revenue forecasts for the IoT and electric vehicle segments, Huaxing Securities has raised Xiaomi's revenue forecasts for 2024-2026 by 2%-5% [2] - Adjusted net profit forecasts for 2024-2026 have been increased by 4%-21%, with a projected CAGR of 22% for adjusted net profit during this period [2]