Ge Long Hui A P P·2025-09-18 02:35Core Viewpoint - AI is reshaping Baidu's long-term narrative, with the company being one of the few domestic internet firms possessing self-developed chip capabilities, AI infrastructure services, and various AI application scenarios [1] Group 1: Business Assets - Baidu has several significantly undervalued business assets within its ecosystem, including autonomous driving, self-developed Kunlun chips, and AI-enabled software applications like Baidu Wenku and Baidu Wangpan [1] - The report maintains a "Buy" rating for Baidu, raising the target price from 88 HKD to 236 HKD [1] Group 2: Kunlun Chip Valuation - The valuation for Baidu's Kunlun chip is set at 40.1 HKD per ordinary share, based on a projected price-to-sales ratio of 25 times for this year and a 59% equity stake in Baidu, which is slightly above the comparable company average of 22.9 times [1] - It is anticipated that by 2025, the external revenue scale of Kunlun chips will be comparable to that of another leading domestic firm, Cambricon, with Cambricon's expected revenue for 2025 being approximately 6.7 billion [1] - The valuation level for Kunlun chips is considered reasonable, reflecting a premium for being a leading player in China's domestic substitution market [1]