2025-11-03 03:32Xiaomi Corp. (1810.HK) Conference Call Summary Company Overview - Company: Xiaomi Corp. (1810.HK) - Market Cap: HK$1.1 trillion / $144.0 billion - Enterprise Value: HK$921.6 billion / $118.6 billion - Current Price: HK$43.20 - Target Price: HK$56.50 (implying 30.8% upside) [1][5] Key Industry Insights - Smartphone Market: Expected to face near-term speed bumps but favorable risk-reward on a 12-month basis [1] - AIoT (Artificial Intelligence of Things): Projected revenue growth of 6% in 3Q25 and 9% in 2026, with sequential growth accelerating [10][51] - EV (Electric Vehicle): Anticipated first-time IFRS net profit of Rmb0.7 billion in 3Q25, driven by higher operating leverage [16] Financial Projections - Revenue Forecasts: - 2024: Rmb365.9 billion - 2025E: Rmb465.3 billion - 2026E: Rmb595.1 billion - 2027E: Rmb710.8 billion [5][13] - EBITDA: - 2024: Rmb30.8 billion - 2025E: Rmb55.3 billion - 2026E: Rmb62.6 billion - 2027E: Rmb79.4 billion [5][13] - EPS (Earnings Per Share): - 2024: Rmb1.07 - 2025E: Rmb1.57 - 2026E: Rmb1.91 - 2027E: Rmb2.38 [5][13] Margin and Profitability - Gross Profit Margin (GPM): Expected to decline to ~10% in 2026E due to rising memory costs, compared to ~11% in 2H25E [10][19] - Net Profit Resilience: Core net profit expected to remain flat year-over-year in 2026E, supported by increased contributions from AIoT and internet services [10][19] Competitive Landscape - Market Position: Xiaomi's comparative advantages expected to strengthen against peers due to larger scale and ecosystem [10][19] - Smartphone Contribution: Smartphone gross profit contribution is projected to decrease to 24% of total gross profit by 2026E [47] Challenges and Risks - Memory Cost Pressure: Anticipated challenges in mass model shipments due to rising memory costs, with a significant impact on pricing strategies [30][32] - Inventory Management: Longer inventory days observed, which may affect gross profit margins [21][26] Upcoming Events to Monitor - Singles' Day GMV: Key indicator of consumer demand and sales performance [17] - 3Q25 Results: Scheduled for late November, expected to provide insights into revenue and profit growth [17] - EV Manufacturing Capacity: Progress on ramping up manufacturing capacity and new model launches [17][18] Summary of Key Metrics - P/E Ratio: 16.6 for 2024, increasing to 25.3 in 2025E [11] - CROCI (Cash Return on Capital Invested): Expected to be 21.7% in 2024, declining to 29.8% by 2027E [11] - Free Cash Flow Yield: 7.2% in 2024, decreasing to 2.4% in 2026E [11] Conclusion - Investment Outlook: Despite short-term challenges, the long-term risk-reward profile for Xiaomi remains favorable, with a target price indicating significant upside potential [1][5]