Core Viewpoint - Xiaomi's recent product launch event showcased multiple new products, including the Xiaomi 17 series smartphones, Pad 8, smart home appliances, routers, and a customized service for Xiaomi cars, highlighting the company's focus on continuous investment in R&D and breakthroughs in self-developed chips and smart vehicles [1][3]. Group 1: Smartphone Launch - The Xiaomi 17 series includes three models: Standard, Pro, and Pro Max, all equipped with Qualcomm Snapdragon 8 Elite chips using TSMC's 3nm process, matching the performance and efficiency of Apple's A19 series [2]. - The battery technology in the Xiaomi 17 series significantly enhances battery life, with the Standard and Pro Max models showing improvements of 109% and 50% in battery life compared to the iPhone 17 and iPhone 17 Pro Max, respectively [2]. - Pricing for the Xiaomi 17 Standard remains at 4499 RMB, while the Pro model is priced at 4999 RMB, reflecting a 300 RMB decrease from the previous year's Pro model [2]. Group 2: Automotive Developments - Xiaomi introduced a customization service for its vehicles, targeting high-end users, with options for limited paint colors and interior features, aiming to 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 potential for further margin improvement with the new customization service [3]. - The SU7 Ultra model, equipped with Xiaomi's self-developed V8s motor, has been recognized as the fastest four-door production car on the Nürburgring track, showcasing advancements in the automotive sector [4]. Group 3: R&D and Financial Outlook - Xiaomi's founder, Lei Jun, emphasized the company's commitment to hard technology, particularly in self-developed chips and electric vehicles, which have seen significant advancements since 2021 [3][4]. - The company has successfully launched the Xuanjie SoC chip, which has been applied in various smartphones and tablets, demonstrating progress in its chip development efforts [4]. - The target price for Xiaomi is set at 65.4 HKD, based on a sum-of-the-parts valuation method, with projected net profits of 443.1 billion, 526.3 billion, and 671.2 billion RMB for 2025-2027 [4].

Investment 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].

Core Viewpoint - Xiaomi has achieved a significant milestone by setting a record for the fastest production electric vehicle at the Nürburgring with a lap time of 7 minutes 04.957 seconds, showcasing its capabilities in the automotive industry and challenging established competitors [3][5]. Group 1: Performance and Achievements - The Xiaomi SU7 Ultra's lap time surpasses that of high-performance vehicles such as the Rimac Nevera and Porsche Taycan Turbo GT, indicating its competitive edge in the electric vehicle market [5][3]. - The record was set by experienced driver Vincent Radermecker, highlighting the importance of skilled drivers in maximizing vehicle performance [12][18]. - The SU7 Ultra's performance places it among the top 30 production cars, competing with renowned brands like Porsche and Lamborghini [22]. Group 2: Technical Aspects and Innovations - The SU7 Ultra boasts a powerful setup with a total output of 1548 horsepower, achieving 0-200 km/h in 5.96 seconds, attributed to its advanced electric motor technology [36][39]. - The vehicle's battery, sourced from CATL, supports a maximum discharge power of 1330 kW, ensuring sustained performance even at lower charge levels [44][45]. - Collaboration with leading suppliers has enhanced the vehicle's performance, including specialized components for suspension, tires, and braking systems [49]. Group 3: Strategic Insights - Xiaomi's success in the automotive sector is attributed to its extensive experience in manufacturing and supply chain management, allowing for rapid scaling and resource mobilization [50][55]. - The company benefits from a favorable market environment and access to advanced technologies, positioning it well against established competitors like Porsche [61][62]. - The pursuit of performance metrics like lap times serves not only as a marketing strategy but also as a demonstration of China's automotive engineering capabilities on a global stage [64][66].