Zhi Tong Cai Jing·2025-11-21 02:37Core Viewpoint - CICC maintains Lenovo Group's FY2026/27 profit forecast largely unchanged, with a target price of HKD 14.8, indicating a potential upside of 52% based on a non-HKFRS net profit metric [1] Group 1: Financial Performance - Lenovo Group reported 2QFY26 revenue of USD 20.452 billion, a year-on-year increase of 14.6%, and a non-HKFRS net profit of USD 512 million, up 25.2% year-on-year [2] - The net profit attributable to shareholders was USD 340 million, which included a non-cash fair value gain of USD 148 million related to warrants and nominal interest of USD 28.47 million from convertible bonds [2] - Overall performance exceeded expectations due to double-digit revenue growth across all three business groups and regions, with AI-related revenue accounting for 30% of total revenue, up 13 percentage points year-on-year [2] Group 2: AI PC and Market Position - The company's IDG revenue grew by 11.8% year-on-year to USD 15.107 billion, with an operating profit margin of 7.3% [3] - Lenovo's PC shipment growth of 17.3% outpaced the industry average of 9.4%, increasing its market share to 25.5% [3] - Lenovo holds a 31.1% share of the global Windows AI PC market, maintaining its leading position, with AI PC products accounting for 30% of notebook shipments in mainland China [3] Group 3: AI Infrastructure Growth - The ISG revenue for 2QFY26 increased by 23.7% year-on-year to USD 4.087 billion, with improved operating profit margins [4] - The cloud infrastructure business achieved record revenue for the period, with AI server revenue showing high double-digit growth and strong order reserves [4] - The enterprise infrastructure business is undergoing a transformation to cater to different business models for large enterprises and SMEs [4]