Summary of Xiaomi Corp. (1810.HK) Conference Call Company Overview - **Company**: Xiaomi Corp. (1810.HK) - **Market Cap**: HK$1.1 trillion / $143.3 billion - **Enterprise Value**: HK$915.9 billion / $117.8 billion - **Current Price**: HK$42.98 - **Target Price**: HK$56.50 - **Upside Potential**: 31.5% [6][20] Key Points Industry and Market Performance - **Singles' Day GMV**: Xiaomi reported Rmb29.0 billion GMV during the Singles' Day promotion, a 9% decrease from Rmb31.9 billion last year [1][21] - **Smartphone Rankings**: Xiaomi ranked No.2 in sales volume and GMV on JD.com, with three models in the top 10 best-sellers [23][27] - **Market Share**: Xiaomi is gaining volume share in the smartphone segment priced below Rmb3,000 while maintaining leadership in the premium segment with the Xiaomi 17 Pro Max [23][32] Product and Manufacturing Insights - **SU7 Pro/Max Delivery Times**: The waiting time for SU7 Pro and SU7 Max has been reduced to 6-9 weeks from approximately 30 weeks, indicating improved manufacturing capabilities [1][2] - **EV Manufacturing**: In October, Xiaomi delivered 48.6k units, including 15.0k SU7 models, reflecting strong demand and capacity utilization [2][20] - **Upcoming Product Cycle**: A potential new facelift for the SU7 is expected to enhance product offerings into 2026 [19][20] Financial Performance and Projections - **Revenue Growth**: Projected revenue growth for 2024 is Rmb365.9 billion, increasing to Rmb710.8 billion by 2027 [6][17] - **EBITDA Growth**: Expected EBITDA growth from Rmb30.8 billion in 2024 to Rmb79.4 billion in 2027 [6][17] - **EPS Projections**: EPS is projected to grow from Rmb1.07 in 2024 to Rmb2.38 in 2027 [6][17] Strategic Initiatives - **Subsidy for Singles' Day**: Xiaomi announced a Rmb2 billion subsidy for the 2025 Singles' Day, up from Rmb1.3-1.6 billion in previous years, to stimulate sales [24] - **AIoT Sales**: Sales pressure was noted in AIoT categories, but personal care devices showed strong growth [23] Risks and Considerations - **Market Conditions**: The company may face challenges due to a high base from the previous year, impacting year-over-year comparisons [23][32] - **Short-term Volatility**: While the share price may experience short-term fluctuations, the long-term outlook remains positive [20] Future Watchpoints - **Upcoming Results**: Anticipation for 3Q25 results in late November [20] - **Capacity Expansion**: Monitoring progress in EV manufacturing capacity ramp-up [20] - **New Product Launches**: Filing of new EV models and potential technology events towards the end of 2025 [20] Conclusion Xiaomi Corp. is positioned for growth with a strong product lineup and improved manufacturing capabilities. Despite facing challenges in the current market environment, the long-term outlook remains favorable with strategic initiatives aimed at enhancing sales and market share.

Investment Rating - The investment rating for the company is "Hold" [1]. Core Views - The company is expected to maintain double-digit revenue growth over the next three years, with profit growth outpacing revenue growth. The projected P/E ratios for 2025, 2026, and 2027 are 24.17, 18.11, and 14.82 respectively, indicating a positive outlook for overall performance [3][12]. Financial Performance - In the first half of 2025, the company reported revenue of 227.25 billion RMB, a 38.2% increase from 164.39 billion RMB in the same period last year. The second quarter revenue reached 116 billion RMB, a 30.5% year-on-year growth, marking a historical high [12][13]. - The net profit for the first half of 2025 was 11.9 billion RMB, reflecting a 134.2% increase year-on-year. Adjusted net profit was 10.8 billion RMB, up 75.4% [12][13]. - The gross margin for the second quarter was 22.7%, an increase of 5.5 percentage points year-on-year, driven by higher-margin businesses and improved production efficiency [13][14]. Business Development - The "Mobile × AIoT" segment generated revenue of 94.7 billion RMB in the second quarter, a 14.8% increase, accounting for 81.6% of total revenue. The IoT and lifestyle products segment saw revenue growth of 44.7% [15][17]. - The smart electric vehicle segment reported revenue of 21.3 billion RMB with a gross margin of 26.4%, indicating simultaneous growth in scale and profitability [18]. - The company’s R&D expenditure in the first half of 2025 was 14.475 billion RMB, a 41.2% increase, focusing on smart vehicle technology and AI model development [23]. Future Development and Summary - The company has successfully implemented its "people, vehicle, home ecosystem" strategy, enhancing user data and service integration across devices. The global layout leverages "China R&D + Global Manufacturing + Regional Delivery" advantages [24].

Core Viewpoint - The Hang Seng Index rose by 0.18% on November 11, with southbound capital recording a total transaction amount of HKD 898.49 billion, resulting in a net inflow of HKD 44.67 billion [1][2] Group 1: Southbound Capital Transactions - Total southbound capital transactions amounted to HKD 898.49 billion, with buy transactions at HKD 471.58 billion and sell transactions at HKD 426.91 billion, leading to a net buy of HKD 44.67 billion [1] - The Hong Kong Stock Connect (Shenzhen) had a cumulative transaction amount of HKD 354.12 billion, with net buying of HKD 17.86 billion, while the Hong Kong Stock Connect (Shanghai) recorded a cumulative transaction amount of HKD 544.37 billion with net buying of HKD 26.81 billion [1] Group 2: Active Stocks - Alibaba-W had the highest transaction amount among southbound stocks at HKD 75.18 billion, followed by Xpeng Motors at HKD 57.58 billion and SMIC at HKD 48.50 billion [1] - Xiaomi Group-W led in net buying with HKD 11.76 billion, while the highest net selling was seen in Xpeng Motors at HKD 22.66 billion, despite its stock price increasing by 17.93% [1][2] Group 3: Continuous Net Buying and Selling - Xiaomi Group-W and CNOOC were the only two stocks with continuous net buying for more than three days, with Xiaomi Group-W having a total net buy of HKD 65.44 billion over ten days [2] - The stocks with the highest continuous net selling included Alibaba-W, Tencent Holdings, and Meituan, with net selling amounts of HKD 33.47 billion, HKD 10.64 billion, and HKD 4.61 billion respectively [2]

Group 1 - Southbound funds recorded a net purchase of 44.67 billion HKD [1] - Xiaomi Group-W, Yingfu Fund, and China Mobile received net purchases of 11.76 billion HKD, 6.51 billion HKD, and 3.57 billion HKD respectively [1] - Xpeng Motors-W had the highest net sell amount, totaling 22.66 billion HKD [1]

Core Viewpoint - The Hong Kong stock market is experiencing activity in the technology sector, driven by strong pre-sale ticket sales for the movie "Demon Slayer," with notable movements in various tech stocks [1] Group 1: Market Performance - Cat Eye Entertainment's stock rose over 6% due to the strong performance of "Demon Slayer" [1] - AI application concept stocks are also active, with Huya Technology up over 3%, Maifushi up over 2%, and Meitu up over 1% [1] - Leading stocks show mixed performance: Xiaomi Group-W up over 2%, Tencent Holdings slightly down, Meitu down over 1%, and Alibaba-W down over 2% [1] - The Hong Kong Internet ETF (513770) opened higher and fluctuated in the red, currently up 0.17% [1] Group 2: Xiaomi's Automotive Sales - In October, Xiaomi's retail sales reached 48,654 vehicles, with the Xiaomi YU7 wholesale sales at 33,662 units, surpassing Tesla Model Y's domestic sales [2] - The cumulative delivery of Xiaomi YU7 has exceeded 70,000 units since its launch on July 6, with expectations to reach 100,000 soon [3] - Citigroup forecasts Xiaomi's automotive division to achieve profitability of 722 million yuan in Q3 [3] - Southbound funds have significantly increased their holdings in Xiaomi Group, with a net purchase of 4.311 billion HKD last week, marking six consecutive weeks of net buying [3] Group 3: ETF and Index Performance - The Hong Kong Internet ETF (513770) tracks the CSI Hong Kong Internet Index, heavily weighted towards leading internet companies like Alibaba-W, Tencent Holdings, and Xiaomi Group-W, which together account for over 73% of the top ten holdings [4][5] - The ETF has seen a net inflow of 732 million yuan over the past ten days [6] - The latest scale of the Hong Kong Internet ETF exceeds 11.8 billion HKD, with an average daily trading volume of over 600 million HKD [7]

Market Overview - The Hong Kong stock market has weakened due to overseas risk aversion, with the Hang Seng Index and Hang Seng Tech Index falling by 0.92% and 1.8% respectively [1] - Major tech stocks such as Alibaba, Xiaomi, Tencent, Meituan, Bilibili, and Kuaishou experienced significant declines, with Kuaishou dropping nearly 6% [1] - Southbound funds actively bought on dips, with a net purchase of HKD 7.523 billion, and Xiaomi received an increase of HKD 989 million [1] ETF Performance - The Hong Kong Internet ETF (513770) opened lower and fell by 2.89%, reaching a six-month low, indicating strong buying interest at lower prices [1] - The ETF saw a net inflow of HKD 137 million yesterday, with a cumulative net inflow of HKD 976 million over the past 10 days [3] Monetary Policy Impact - Fed officials expressed dovish sentiments, revealing internal disagreements on future rate cuts, which negatively impacted market sentiment [5] - The probability of a 25 basis point rate cut by the Fed in December is 70.6% according to CME FedWatch [5] - While short-term volatility is expected due to external liquidity uncertainties, the long-term outlook remains positive as the Fed's easing cycle begins, potentially attracting both southbound and foreign capital into the Hong Kong market [5] AI and Internet Sector Developments - At the World Internet Conference, Alibaba's CEO announced plans to build large-scale AI infrastructure and enhance AI cloud services [6] - The narrative in the internet sector is shifting from user growth to "AI empowerment," indicating a new growth trajectory [6] - The valuation of the Hong Kong internet sector appears attractive, with the CSI Hong Kong Internet Index's latest P/E ratio at 24.68, significantly lower than the NASDAQ 100 (36.25) and ChiNext Index (41.43) [6][7] Investment Opportunities - The Hong Kong market is seen as a valuation bargain globally, with significant room for valuation recovery [5] - The Hong Kong Internet ETF (513770) tracks the CSI Hong Kong Internet Index, which is heavily weighted towards leading internet companies, including Alibaba, Tencent, and Xiaomi, which together account for over 46% of the ETF [8] - The ETF has a current scale exceeding HKD 11.8 billion, with an average daily trading volume of over HKD 600 million, indicating good liquidity [9]

Group 1 - Southbound funds recorded a net purchase of 75.23 billion HKD [1] - Xiaomi Group-W, CNOOC, and Hua Hong Semiconductor received net purchases of 9.67 billion HKD, 7.64 billion HKD, and 6.06 billion HKD respectively [1] - Tencent Holdings had the highest net sell amount, totaling 4.72 billion HKD [1]

人民财讯11月7日电，南向资金今日净买入75.23亿港元。小米集团-W、中国海洋石油、华虹半导体分别 获净买入9.67亿港元、7.64亿港元、6.06亿港元；腾讯控股净卖出额居首，金额为4.72亿港元。 ...

Core Viewpoint - Xiaomi Group-W (01810.HK) has experienced a decline of over 30% from its highest point in June of this year, with the current stock price dropping more than 3% to 42.1 HKD as of the report, accompanied by a trading volume of 3.076 billion HKD [1] Summary by Category - **Stock Performance** - The stock price of Xiaomi Group-W has decreased by 3.08%, currently standing at 42.1 HKD [1] - The stock has fallen over 30% from its peak in June [1] - **Trading Activity** - The trading volume reached 30.76 billion HKD at the time of the report [1]

Core Viewpoint - Xiaomi Group-W (01810) has seen its stock price drop over 30% from its peak in June, with a current price of 42.1 HKD, reflecting a decline of 3.08% as of the latest report [1] Group 1: Stock Performance - The stock price of Xiaomi has decreased by over 30% since its highest point in June [1] - As of the latest report, the stock is trading at 42.1 HKD with a trading volume of 30.76 billion HKD [1] Group 2: Hedge Fund Activity - Recent data from Goldman Sachs indicates a 53% increase in short positions against Xiaomi by hedge funds over the past week [1] - The selling pressure from pension funds and hedge funds has dominated the market in the last two weeks [1] Group 3: Investor Sentiment - Investor sentiment is turning cautious ahead of Xiaomi's third-quarter earnings report scheduled for November 18 [1] - Hedge funds view Xiaomi as a consensus short/sell target in the short term due to a lack of catalysts [1] Group 4: Analyst Downgrades - Goldman Sachs has recently lowered its target price for Xiaomi, citing several factors [1] - Key reasons for the downgrade include rising storage chip prices impacting smartphone gross margins, a slowdown in AIoT business growth to single digits, and delays in the second phase of electric vehicle factory affecting deliveries [1]