HK Stock Market Move | XIAOMI-W(01810) rose more than 3% in the morning, with Credit Suisse expecting its first quarter performance to exceed expectations. AIoT brings more profit potential.

XIAOMI-W(01810) rose more than 3% in the morning, up 3.19% to HK$51.7 as of the end of the press release, with a turnover of HK$4.648 billion. In terms of news, Xiaomi Group is set to release its first quarter performance on May 27th. Credit Suisse expects Xiaomi Group's first quarter performance to exceed expectations, mainly due to its Artificial Intelligence of Things (AIoT) business. The report indicates that it is expected that sales of Xiaomi's electric vehicle SU7 will increase by 9% to about 74,000 units in the first quarter of this year, while the average selling price will remain stable. The bank also points out that although the market is mainly focused on Xiaomi's electric vehicle business, it believes that the group's AIoT business is another underestimated sector that has the potential to bring positive surprises in terms of short-term profitability. Xiaomi's advantages in design, cost, and performance, as well as its online and offline marketing expertise, are expected to drive rapid market share growth. BOCOM INTL released a research report stating that Xiaomi, as a core target in the Chinese technology industry, is also a pioneer in independent innovation and domestic substitution, with a relatively small direct exposure to trade uncertainties. The high-end smart phone market and continued expansion in emerging markets, as well as the positive impact of declining memory costs on gross margin, may be concentrated in the first half of 2025; the release of smart car capacity may turn into profit by 2025; AIoT will further expand into major appliances, expand offline and overseas channels. The bank points out that there may be differences in investors' valuation methods for Xiaomi. Through the SOTP method, based on a 26x PE ratio for the phone and AIoT business in 2026, and a 2.0x sales ratio for the automotive business, a target price of HK$60 is obtained.