Xiaomi 1810

[winston]

Xiaomi shares suffer Google pain

Shares of Xiaomi (1810) hit a low for this year after the Beijing-headquartered multinational electronics firm admitted some of its mobile phone models in the mainland do not support Google Mobile Service.

Some mainland mobile users said on the community platform for MIUI that they could not install Google Mobile Service-related services by using the new version of MIUI 12.5. So they could not use Google Play Store, Google Map, YouTube, Gmail, among others.

Source: The Standard

https://www.thestandard.com.hk/section- ... oogle-pain

[winston]

not vested

Xiaomi says some phone models will not support Google

Xiaomi (1810) has clarified news that the company no longer supports Google Mobile Services.

The Chinese company said the related statement came from the members of the Xiaomi fan group, and not an official statement.

The company explained some domestic models have pre-installed the GMS service framework, and these will not be affected.

For models that do not have a pre-installed GMS service framework, the company will no longer specifically support users to install GMS frameworks by themselves in the future, but the company will add more models of GMS systems pre-installed to meet user needs in the future. International models are not affected

Source: The Standard

https://www.thestandard.com.hk/breaking ... ort-Google

[winston]

not vested

Xiaomi Corp (1810 HK) - Good margins with continued share gain

Xiaomi’s 4Q20 results came in above expectations.

Gross margin was robust at 16.1% (+2.2ppts YoY), while adjusted net income grew 37% YoY to RMB 3.2b, which was above that of consensus by ~10%.

Smartphone GPM reached 10.5% in 4Q20, which is notably above the 7 8% range seen in the past few years.

Management attributed this to an improving product mix towards more premium-tier smartphones as well as less aggressive marketing and promotions amid supply shortages in the smartphone market.

Xiaomi’s China smartphone market share has increased from 10.7% in 4Q19 to 14.6% in 4Q20, according to Canalys, which we believe was largely attributed to the restrictions on Huawei.

Internet services also saw robust GPM of 68.4%, on the back of greater contribution from the advertising business, better monetization of premium smartphone users as well as a shift in the Fintech business model (from balance sheet to platform business).

Still, we remain somewhat cautious as weak pricing power at gaming and tight regulatory on fintech could hinder sales expansion.

We also continue to monitor Honor’s roll-out in China (despite the lead-time needed for product launches), as well as the ongoing chip shortage risk and possible implications on shipments and margins. HOLD.

Source: OCBC

[winston]

not vested

Xiaomi Corp (1810 HK) - Good quarter with better-than-expected gross margin

Xiaomi’s 1Q21 results came in above expectations.

Revenue grew 54.7% YoY to RMB76.9b, which was ~3% ahead of consensus.

Adjusted net profit grew 164% YoY to RMB6.1b, which beat consensus estimates by ~54%.

For smartphones, Xiaomi will continue to grow offline channels and retail stores in China and carrier channels overseas.

Management shared that Xiaomi’s inventory level remains healthy and even in the face of the ongoing chip shortages, preparations have been made in terms of raw materials for 2H21.

Strong advertising revenue growth was off the back of higher pre-install and search revenue on premium smartphones.

In our view, Xiaomi remains on track to deliver strong growth in its smartphone strategy, with premiumization in the product mix helping to also drive growth in internet services.

However, we remain cautious in the near-term, given more modest April CAICT China smartphone shipment numbers.

From an ESG perspective, Xiaomi could face potential challenges in implementing responsible practices in its supply chain, given that its suppliers are mainly based in countries where regulatory labor standards are less stringent relative to global standards.

Thus, we incorporate a 5% discount on our target multiple, and following adjustments, we raise our FV from HKD27.40 to HKD30.74. HOLD.

Source: OCBC

[winston]

not vested

Brokers' Post-result Ratings, TPs, Views on XIAOMI-W (01810.HK) (Table)

Brokers|Ratings|TPs (HKD)
Citigroup|Buy|32
Morgan Stanley|Overweight|31.5
Nomura|Neutral|31
Goldman Sachs |Buy|28.5
JPMorgan|Overweight|28
Credit Suisse |Outperform|28.5->27
Daiwa|Outperform|24
UBS|Neutral|23
Macquarie|Neutral|19.52
BofA Securities|Outperform|19->18.7

---------------------------------------------------------------------
Brokers|Views

Citigroup|Supply chain challenge lingered throughout 3Q; result in line
Morgan Stanley|Company expected to see improvement in 4Q
Nomura|3Q GPM reached 18.3%; ahead of estimate; result in line
Goldman Sachs|3Q earnings grew 25%; in line
JPMorgan|3Q earnings growth in line; internet service maintained stable growth
Credit Suisse|3Q result broadly in line despite constrained supply
Daiwa|Supply chain issue expected to ease by 1H22; market share expected to see continuous growth in next two years
UBS|No major surprise from result announcement
Macquarie|Internet service revenue saw rapid growth in overseas; but may encounter intensifying industry competition
BofA Securities|Smartphone business outlook difficult; internet business may potentially see challenges

Source: AAStocks Financial News

[winston]

not vested

Xiaomi Corp (1810 HK) - Challenging conditions for smartphone shipments

Xiaomi’s 3Q21 results were broadly in-line.

While internet services GPM was robust at 73.6%, we still remain somewhat cautious given the more muted sentiment in domestic ads in light of the more subdued outlook per management teams of other internet platform companies.

3Q21 adjusted earnings grew 25% YoY to RMB5.2b, which was ~8% above consensus.

Guidance for 2021 smartphone shipments has been lowered from 200m to 190m, with 2H21 facing notable supply shortages.

Management notes that they will continue to expand their offline network in mainland China (though the ramp up will need time) and focus on productivity of stores.

While smartphone GPM is supported by better mix, we do not exclude the possibility that rising opex pressures resulting from continued offline expansion could impact operating income.

Following adjustments (while keeping our ESG discount unchanged), we also employ a lower target P/E multiple of 18.8x (0.25 SD below the 2FY 5-year mean) in light of a more uncertain outlook for smartphones as well as potential internet headwinds ahead.

As such, our FV drops from HKD27.71 to HKD21.29. HOLD.

Source: OCBC

[winston]

not vested

Smartphone sales remain resilient in FY22F

3Q21 non-IFRS net profit rose 25% yoy to Rmb5.18bn. 9M21 NP met 82% of our FY21F. We deem this in line as we expect a solid quarter in 4Q21F.

We expect smartphone shipments to rise 17% yoy to 225m units in FY22F, driven by overseas carrier channel and China offline channel expansion.

Reiterate Add. Our TP of HK$34.13 is based on 25x FY22F P/E.

Source: CIMB

https://rfs.cgs-cimb.com/api/download?f ... 46C68DA737

[winston]

not vested

Xiaomi beats as profit surges 70pc

by Caroline Zheng

Chinese smartphone maker Xiaomi (1810) reported a nearly 70 percent surge in adjusted net profit to 22.04 billion yuan (HK$27.12 billion) last year, beating estimates, and said it would spend up to HK$10 billion to buy back its shares.

Total revenue rose by 33.5 percent to 328.3 billion yuan and revenue from overseas markets grew 33.7 percent to 163.6 billion yuan, accounting for 49.8 percent of the total.

Revenue from its smartphone business rose 37 percent while smartphone shipments grew 30 percent to 190.3 million units last year, a record high, it said.

Its smartphone shipments ranked third globally in 2021, with a market share of 14.1 percent, the company said citing data from Canalys.

For the fourth quarter, the company's adjusted net income jumped 40 percent to 4.47 billion yuan, with sales up 21 percent during the busy holiday season.

However, Xiaomi faces prolonged component shortages and fluctuating producer prices in the second half of 2021.

Russia's invasion of Ukraine will hinder its overseas business, although the impact will be "manageable," Citigroup analysts Andre Lin and Arthur Lai said in a note.

Xiaomi's smartphone shipments to Russia could fall by 3 million units in 2022, they said.

Source: Bloomberg

https://www.thestandard.com.hk/section- ... urges-70pc

[winston]

not vested

Xiaomi Corp (1810 HK)
2021: Solid Results And Attractive Valuations, Remain Cautious On Industry Downturn

4Q21 results were above our estimates but largely in line with consensus’.

We see encouraging signs in strong smartphone ASP, better-than-expected IoT/internet service margins but also spotted concerning trends of slowing internet service growth in
China.

We remain conservative given the sluggish industry in 2022, but the share
buyback scheme should support share price in the near term.

Maintain BUY and trim target price to HK$18.60.

Source: UOBKH

https://research.uobkayhian.com/content ... 902f0e15ac

[winston]

not vested

Brokers│Views

Morgan Stanley│Quarterly results in line; $10 billion share repurchase program will likely hail positive sentiment

Citigroup│Quarterly results beat forecast; valuation attractive

DBS│Results slightly missed forecast

CLSA│Increased share in high-end market

Credit Suisse│Quarterly results beat estimate; 1H22 result forecast reduced

JPMorgan│Business execution satisfactory but market environment remained difficult

Nomura│2022 smartphone delivery target may face challenge

Macquarie│Increasing challenge in smartphone market

Related News: XIAOMI 2021 Adj. NP Up 69.5% to RMB22.04B, Beating Forecast

Source; AAStocks Financial News