CICC: Maintain Xiaomi Group-W (01810) "outperform industry" rating and raise target price to HK $76.9

Zhitong Finance APP learned that CICC released a research report saying,MilletGroup-W (01810) held a full ecological launch conference for Xiaomi Renchejia, and released Xiaomi YU7, Xiaomi AI glasses and a variety of new IoT products. Considering that Xiaomi YU7 will exceed expectations, the adjusted net profit in 2025/2026 will be raised by 2%/17% to 49.048 billion yuan/66.384 billion yuan. The current stock price corresponds to a 2025/2026 adjusted net profit P/E of 28.0/20.4 times. Maintain the outperform industry rating, take into account the adjustment of profit forecast and the upward shift of the industry valuation center, and raise the target price by 9.9% to HK $76.9 (based on the SOTP valuation method), corresponding to the adjusted net profit P/E of 37.8/27.5 times in 2025/2026, with 35.1% upside.

The main views of CICC are as follows:

Xiaomi YU7 is ordered to exceed 289,000 units within one hour of its release, and its high product strength helps the new car break the circle

This time Xiaomi released three models of YU7 standard version, Pro version, and Max version, with a starting price of 253,500 yuan. In terms of performance, YU7 uses Xiaomi Super Motor V6s Plus, which can accelerate from 0 to 100 in 3.23 seconds; In terms of battery life, all Xiaomi YU7 series have long battery life with 800V silicon carbide high-voltage platform fast charging; In terms of intelligence, all Xiaomi YU7 series come standard with a full set of high-standard assisted driving hardware (includingNvidiaThor chip/lidar/4D millimeter wave radar/11 high-definition cameras/12 ultrasonic radars) and 10 million Clips version of Xiaomi end-to-end assisted driving. According to official data from Xiaomi Motors, YU7 will exceed 289,000 units within one hour of release. The bank believes that Xiaomi YU7's exceeding expectations reflects consumers' recognition of Xiaomi's cost-effective product strength, and the superimposed brand potential shows strong product strength and circle-breaking effect, achieving the effect of supply creating new demand.

Xiaomi releases its first AI glasses to explore new terminals in the end-side AI era

Xiaomi's first AI glasses have achieved a breakthrough of "lightweight, high performance, and long battery life": 1) In terms of weight, the frame weight is as light as 40g, which is lower than the weight of mainstream AI glasses; 2) In terms of performance, it is equipped with a 12-megapixel ultra-transparent optical lens, f/2. 2 large aperture, and 105-degree ultra-wide angle; In addition, the glasses have built-in "Super Little Love", giving the products strong multi-modal intelligent interaction capabilities; 3) In terms of battery life, compared with battery capacityMetaSimilar products increased by 64%.

The strategy of "full ecology of people, cars and homes" is advancing steadily, and we are optimistic that the release of new products will drive the brand potential to continue to rise

The bank believes that the number of Xiaomi YU7 orders exceeded expectations, and the release of new products such as the first AI glasses is expected to continue to boost the brand's potential. Looking forward to the future, the bank is optimistic about Xiaomi's adherence to the four core strategies of "scale ecology + hard-core technology + high-end brand + market globalization". In the future, with the continuous integration of the "full ecology of people, cars and homes" at the user level and the underlying system Optimization, its important entry position in multiple end-side hardware fields such as mobile phones, automobiles, IoT, AI glasses, and robots may be further highlighted.

Risk warning:The global macro economy affects the demand for smartphones and IoT products, and the sales of smart cars are lower than expected.