Xiaomi Corp. (1810.HK)_ Lift TP on stronger EV execution; Assessing SU7 Ultra_SUV and Xiaomi 15 potential; Buy

Summary of Xiaomi Corp. (1810.HK) Conference Call Company Overview - Company: Xiaomi Corp. (1810.HK) - Industry: Electric Vehicles (EV) and Consumer Electronics Key Points and Arguments 1. Target Price Adjustment: Goldman Sachs reiterates a Buy rating on Xiaomi with a revised 12-month target price of HK$27.5, up from HK$24.7, reflecting confidence in the company's growth trajectory and EV execution [2][5][6] 2. User-Centric Strategy: Xiaomi is focusing on a "Human x Car x Home" strategy, which is expected to drive user engagement and sales both in China and globally [2] 3. EV Deliveries and Manufacturing Capacity: - Xiaomi aims for 20,000 monthly deliveries of the SU7 model starting October 2024, up from 10,000+ in Q3 2024, which is expected to reduce the current waiting period of 22-28 weeks [9] - The company has raised its delivery volume forecast for the SU7 to 225,000 units for 2025, reflecting strong demand [9] 4. Financial Projections: - Revenue estimates for 2024-2026 have been revised upwards by 0%/3%/8% due to higher EV volume assumptions, with projected delivery volumes of 120k/269k/473k for 2024-2026 [2] - Group net profit estimates for 2024-2026 have been maintained, with a projected core net profit of Rmb29bn/Rmb31bn/Rmb34bn [2] 5. New Model Launch: The SU7 Ultra prototype is set to compete in performance metrics with high-end models like the Porsche Taycan, indicating Xiaomi's ambition to enter the premium EV market [10][12] 6. Construction of EV Factory Phase II: The construction of the second EV factory is progressing faster than expected, with potential mass production starting in Q4 2025, ahead of market expectations [13][15] 7. Market Positioning: The SU7 Ultra is expected to be priced competitively against models like the Porsche Panamera and Tesla Model S, with an average selling price (ASP) of Rmb800k [12][10] Additional Important Information 1. Financial Metrics: - The company reported a net loss of Rmb7.8bn for the smart EV segment, indicating challenges in profitability despite revenue growth [5] - The current share price implies a valuation of 16x 2025E P/E for Xiaomi core and 1x 2025E EV/Sales [6][8] 2. Market Dynamics: The EV segment is expected to contribute significantly to Xiaomi's revenue, with projections indicating that 15% of total EV revenue will come from the SU7 Ultra by 2025 [2][12] 3. Competitive Landscape: Xiaomi's strategy includes leveraging its existing smartphone and IoT ecosystem to enhance its EV offerings, aiming to capture a larger market share in the growing EV sector [2][4] This summary encapsulates the critical insights from the conference call, highlighting Xiaomi's strategic direction, financial outlook, and competitive positioning in the EV market.