Guotai Junan Securities·2024-08-20 07:41Investment Rating - The report maintains a rating of "Buy" for Lenovo Group [4][11]. Core Views - Lenovo Group is expected to benefit from a strategic partnership with Alat, a subsidiary of Saudi Arabia's Public Investment Fund, which includes a $2 billion convertible bond issuance and warrants to enhance its global supply chain and market presence in the Middle East and Africa [4][5]. - The company anticipates significant cost savings and improved financial performance due to the favorable financing terms provided by Alat, which will save approximately $100 million in annual interest expenses over the next three years [4][5]. - The report projects Lenovo's revenue for FY2025 and FY2026 to be $61.9 billion and $63.6 billion, respectively, with net profits of $1.23 billion and $1.62 billion [4][5]. Financial Summary - Revenue for FY2023 is reported at $61.9 billion, with a forecasted decline of 13.5% from FY2022, followed by a recovery in FY2025 with an expected growth of 8.9% [4][6]. - Gross profit for FY2023 is estimated at $10.5 billion, with a projected increase to $11.4 billion by FY2026 [4][6]. - The diluted GAAP earnings per share for FY2023 is expected to be $0.12, with projections of $0.10 and $0.13 for FY2025 and FY2026, respectively [4][6].