HK Stock Market Move | LENOVO GROUP (00992) rose over 5% as its AI business grows rapidly with abundant orders; CLSA reiterates the company as its top pick among Chinese tech stocks.

LENOVO GROUP (00992) rose over 5%, up 5.24% as of press time, at HK$36.12, with a turnover of HK$775 million. On the news front, CLSA noted in a recent research report that it reiterates LENOVO GROUP as its top pick among Chinese tech stocks, maintaining an "Outperform" rating with a target price of HK$48.7. Akamai Technologies recently announced a seven-year cooperation agreement with AI company Anthropic, and disclosed a supply agreement with Lenovo, under which Lenovo will provide hardware, software and related services to Akamai. The master agreement has a term of three years, and the first statement of work has a term of seven years, matching the duration of the cooperation between Akamai and Anthropic, reflecting that Lenovo's ISG business is securing long-term cooperation opportunities with various new AI customers. LENOVO GROUP Senior Vice President and Chief Financial Officer Wong Wai Ming previously stated bluntly that Lenovo's valuation is roughly one-seventh that of Dell, but our revenue and net profit are not seven times apart. In this regard, we are completely undervalued by the market. He emphasized that Lenovo's long-term net margin could reach 5%-8%, benchmarked against Dell's profitability level. Lenovo's previously released first fiscal quarter results showed that adjusted profit attributable to equity holders for the quarter increased 176% year-on-year to US$1.075 billion; adjusted net margin reached 4%. Its AI business is growing rapidly with abundant orders. Its AI server backlog orders surged significantly from RMB140 billion in the previous fiscal quarter to RMB360 billion.