HTSC·2025-09-26 07:56Investment Rating - The report maintains a "Buy" rating for Xiaomi Group with a target price of HKD 65.4 [5][7]. Core Insights - Xiaomi's recent product launch includes the Xiaomi 17 series smartphones, Pad 8, smart home appliances, routers, and a customized service for its automotive line, indicating a strong focus on innovation and ecosystem development [1][2]. - The company emphasizes its ongoing investment in hard technology, particularly in self-developed chips and smart vehicles, which are expected to support the development of a comprehensive "people-vehicle-home" ecosystem [1][4]. Summary by Sections Mobile Phones - The Xiaomi 17 series features competitive pricing and significant improvements in battery life, with the standard version priced at HKD 4,499 and the Pro version at HKD 4,999, which is a reduction of HKD 300 from the previous model [2]. - The new series utilizes Qualcomm's Snapdragon 8 Elite chip, manufactured with TSMC's 3nm process, and boasts a battery life improvement of 109% for the standard model compared to the iPhone 17 [2]. Automotive - Xiaomi introduced a customization service for its automotive line, allowing for personalized options for the SU7 Ultra and YU7 Max models, which is expected to attract high-end users and enhance brand prestige [3]. - The gross margin for Xiaomi's automotive and AI innovation business reached 26.4% in Q2 2025, an increase of 11 percentage points year-over-year, indicating a positive trend in profitability [3]. Annual Presentation - Founder Lei Jun highlighted the company's advancements in self-developed chips and electric vehicles since 2021, showcasing the successful launch of the Xuanjie SoC chip and the SU7 Ultra model, which has achieved notable performance metrics [4]. Profit Forecast and Valuation - The report projects Xiaomi's net profit for 2025-2027 to be RMB 443.1 billion, RMB 526.3 billion, and RMB 671.2 billion respectively, maintaining a target price of HKD 65.4 based on a sum-of-the-parts (SOTP) valuation method [5][42].