XIAOMI(HK:01810) Huajing Securities·2025-02-19 06:09Investment Rating - The report maintains a "Buy" rating for Xiaomi Group with an updated target price of HK$52.00, reflecting a P/E ratio of 38.5 times the adjusted EPS for 2025 [2][6][21]. Core Insights - The report anticipates strong performance in Q4 2024, with revenue expected to exceed RMB 100 billion for the first time, reaching RMB 105 billion, a year-on-year increase of 43% [4][14]. - Key growth drivers for 2025 include national consumption subsidy policies, expansion in electric vehicle (EV) production capacity, and the monetization of CEO Lei Jun's personal brand [5][19]. - The report emphasizes that Xiaomi's strong financial performance from 2024 to 2025 marks the beginning of a structural growth phase rather than a cyclical recovery peak [5][21]. Financial Summary - Revenue projections for Xiaomi are as follows: - 2024E: RMB 361.95 billion - 2025E: RMB 444.69 billion - 2026E: RMB 487.60 billion - Adjusted net profit estimates are: - 2024E: RMB 25.96 billion - 2025E: RMB 31.62 billion - 2026E: RMB 38.52 billion [7][18][24]. Segment Performance - Smartphone revenue is projected to reach RMB 206.99 billion in 2025, with a year-on-year growth of 9% [16]. - IoT and lifestyle products are expected to generate RMB 121.74 billion in 2025, reflecting a 18% increase [16]. - The electric vehicle segment is forecasted to grow significantly, with revenues projected at RMB 76.19 billion in 2025, marking a 136% increase [16]. Adjustments and Forecasts - The report revises revenue forecasts upward by 2%-5% for 2024-2026, driven by higher expectations for IoT and EV segments [5][18]. - Adjusted net profit forecasts have been increased by 4%-21% for the same period, with a projected CAGR of 22% from 2024 to 2026 [5][18]. Valuation - The updated target price reflects a 53% increase from the previous target of HK$34.00, based on a higher adjusted net profit estimate of RMB 316.24 billion for 2025 [6][19]. - Xiaomi's current trading price shows a slight discount compared to Apple, despite faster revenue and profit growth [6][19].