Lyon: The national mobile phone subsidy has officially been launched as expected, the preferred options are XIAOMI-W (01810), AAC TECH (02018), etc.

Lyon released a research report stating that the National Development and Reform Commission announced that the scope of the old-for-new subsidy policy will be expanded to include more digital products, including mobile phones, tablets, and smart watches/wristbands. This is in line with expectations, and it is believed that the Android supply chain with higher fixed costs should be more sensitive to this policy. It is recommended to prefer XIAOMI-W (01810), BYD ELECTRONIC (00285), AAC TECH (02018), and SUNNY OPTICAL (02382), all rated as "outperform". Lyon predicts that the sales of smartphones in China will reach 278 million units in 2024. It is currently estimated that a nationwide subsidy policy can drive a growth of about 15% in the sales of smartphones in China this year, reaching 320 million units, equivalent to a 3.5% increase in global smartphone sales in 2025. Based on this sales forecast, assuming an average retail price of 2,000 RMB for Chinese smartphones and a subsidy rate of 15%, it is expected that central and local governments will need to provide a total subsidy of 96 billion RMB this year.