Ge Long Hui·2025-09-09 03:58Core Insights - Lenovo is expected to benefit from the strong demand driven by the global development of hybrid artificial intelligence, leveraging its global layout to mitigate uncertainties [1][3] - The company has completed a $2 billion investment plan in Saudi Arabia and is establishing a factory there, which is anticipated to provide significant growth opportunities in the Middle East [1][3] - Hybrid AI solutions are becoming new growth drivers across three major business lines, further solidifying Lenovo's global competitive advantage [1][2] Group 1: AI and PC Market - The penetration rate of AI PCs is rapidly increasing, with hybrid AI solutions emerging as a key growth driver [2] - Lenovo's global PC market share reached a record high of 24.6% in Q2 CY25, and the market share advantage is expected to continue expanding [2] - The current market penetration rate for AI PCs is approximately 30%, with user engagement for AI applications reaching 40% [2] Group 2: Global Manufacturing and Investment - Lenovo's unique "China + N" global manufacturing layout demonstrates significant advantages in the current trade environment, with over 30 manufacturing bases worldwide [3] - The company has completed a $2 billion zero-interest convertible bond investment with Saudi Arabia's Public Investment Fund, establishing a production base expected to commence operations in 2026 [3] - This investment aligns with Saudi Arabia's "Vision 2030" national strategy, focusing on AI infrastructure and digital economy development [3] Group 3: Financial Projections - Lenovo maintains a target price of HKD 16.0, corresponding to a 15x FY2026E PE, and continues to hold a "Buy" rating [1][3] - Non-HKFRS net profit forecasts for FY26/27/28 are projected at $1.69 billion, $1.89 billion, and $2.12 billion, representing year-on-year growth of 17.6%, 11.3%, and 12.4% respectively [3] - Non-HKFRS EPS estimates for FY26/27/28 are $0.14, $0.15, and $0.17 [3]