Xiaomi 1810

[winston]

not vested

Xiaomi Corp (1810 HK) - Feeling the impact from consumer demand slowdown

Xiaomi delivered a relatively in-line set of 1QFY22 results.

Smartphone revenue dropped 11% YoY to RMB45.8b largely due to the decrease in smartphone shipments, though partially offset by an increase in average selling price (ASP).

As for Internet of Things (IoT) and Lifestyle Products, revenue growth has slowed from 26% year-on-year (YoY) in 2021 to 7% in 1QFY22.

Elevated OPEX levels weighed on earnings, as Xiaomi booked RMB425m in expenses related to smart electric vehicles (EV) and other new initiatives.

While management expects supply improvements in 2QFY22, the impact of Covid-19 lockdowns has not only dampened demand, but also limited certain component supplies from Shanghai.

For IoT, we believe that despite expanding product categories, demand could remain soft in 2022 given consumer weaknesses across China and Europe.

In terms of internet services, management noted that ad budgets remain tight in China due to strict regulation, though a rising user base in China and overseas could help its performance-based ads and search revenue.

We continue to remain on the sidelines, given the murky outlook and the lack of re-rating catalysts.

Following estimate and assumption revisions, we revise our FV down from HKD15.37 to HKD12.00, while still maintain our ESG discount of 5%. HOLD.

Source: OCBC

[winston]

not vested

Nomura: Xiaomi's Smartphone Inventory May Still Take Time to be Consumed; Mi 12 Series' Total Shipments in 1st Yr Unlikely to Top Last Series

XIAOMI-W (01810.HK) showcased multiple new products at the mid-year new products launch event, including the Mi 12S series and IoT products, reported Nomura.

Given the tepid market demand and the fact that XIAOMI-W's smartphone inventory will take a certain period of time to be consumed, Nomura predicted that the total shipment volume of the Mi 12 series in the first fiscal year (4Q21-3Q22) will unlikely be able to surpass that of the previous series.

Nomura kept XIAOMI-W at Neutral, with a target price of $16.

Source: AAStocks Financial News

[winston]

not vested

Xiaomi Corporation (1810 HK)

According to Canalys, 2Q22 global smartphone shipments fell 9% YoY amid economic headwinds, sluggish demand and inventory pileup.

Xiaomi's global market share arrived at 14% in 2Q22 (vs. 1Q22 of 13%), implying its 2Q22 shipments could arrive at around 39-41m units(- 21 to 27% YoY).

On a QoQ basis, Xiaomi's global market share has stabilized and improved slightly. In China, Xiaomi's market share remained at c.14%.

Source: Maybank

[winston]

not vested

Xiaomi’s US$10b car project said to hit regulatory barrier

Talking to officials at the National Development and Reform Commission about the licensing for months without success.

The EV division has more than 1,000 employees and Xiaomi has said it plans to mass produce its first vehicle in 2024.

It has acquired land in the southeastern suburbs of Beijing for an assembly plant, and bought EV startups to add technology.

In early 2021, Lei pledged to invest about US$10 billion over 10 years to make Xiaomi-branded cars.

Source: Bloomberg

https://www.theedgemarkets.com/article/ ... ry-barrier

[winston]

not vested

Xiaomi Corp (1810 HK): <Earnings First Take> 2Q22 adjusted net profit decreased 67% y-o-y to Rmb2.1bn, in line with the market consensus [BUY, TP HK$14.50]

2Q22 revenue decreased by 20.1% y-o-y to Rmb70.2bn due to the weak global smartphone shipment

Adjusted net profit decreased by 67.1% to Rmb2.1bn, in line with the market consensus

Gross margin contracted by 0.5ppt y-o-y to 16.8% because of the smartphones’ destocking and weak premium phone sales

Expect neutral share price reactiion

Source: DBS

[winston]

not vested

Xiaomi Corp (1810 HK) - Murky recovery trajectory

Xiaomi’s 2QFY22 results were broadly within expectations.

Total revenue fell 20.1% YoY to CNY70.2b, or broadly in-line with consensus.

Smartphone revenue fell 28% YoY on the back of lower smartphone shipments (-26% YoY) as well as lower ASP (-3% YoY).

Gross profit margin from the segment fell 3.1ppts YoY due to promotional efforts to clear inventories, as well as increase in costs due to USD appreciation.

All considered, the group registered a GPM drop of 0.5ppts to 16.8% in 2Q22.

In our view, higher opex-to-sales ratio of 14.8% (+3.5ppts YoY) on the back of high R&D expenses likely weighed on the bottom line.

Adjusted net profit fell 27% YoY to CNY2.1b, or 5% above consensus.

We understand that management expects the smartphone shipment in 2H22 to be higher on a HoH basis on better supply chain, promotion season and high-end products being launched.

Management noted that the higher levels of finished goods this quarter in inventory is largely to do with its overseas market and the impact of more subdued consumer buying power.

Efforts will be taken in 2H22 to run down some of these finished products through a variety of means, such as promotions and adjustments to the production schedules.

On the EV opportunity – we remain cautious over any potential drag on operating efficiency arising from higher R&D levels.

In our view, Xiaomi’s near-term prospects could still be somewhat challenging, given the cloudy consumption outlook, need to clear inventories and lack of near-term catalysts.

Following estimate and assumption revisions, we revise our FV down from HKD12 to HKD11, while still maintain our ESG discount of 5%. HOLD.

Source: OCBC

[winston]

Look forward to FY23F and beyond

3Q22F adjusted net profit likely fell 59% yoy (+2% qoq) to Rmb2.1bn due to 9% decline in SP shipments and narrower IoT/Internet services profit margin.

SP shipments may remain weak in 4Q22F and 1H23F before seeing a recovery in 3Q23F.

Reiterate Add as we expect smartphone shipments to gradually recover in FY23F/24F. Our lower TP of HK$12.00 is based on 18x FY23F P/E.

Source: CIMB

https://rfs.cgs-cimb.com/api/download?f ... 7094671BBA

[winston]

not vested

Xiaomi Corp (1810 HK)
3Q22 Results Preview: Still Deteriorating yoy But Stabilising Sequentially

Xiaomi will report its 3Q22 earnings on 23 Nov 22.

We expect the company’s revenue to grow 10% yoy but remain flat qoq, and adjusted netp rofit to decline both 62% yoy and 6% qoq.

While the sharp yoy decline is well-expected, the sequential decline should
have stabilised, while inventory level has been improving since end-2Q22.

Maintain BUY but trim target price to HK$11.30.

Source: UOBKH

https://research.uobkayhian.com/content ... 5f6ab8821a

[winston]

not vested

Flagship Xiaomi debut delayed

Xiaomi (1810) has delayed the launch of its latest flagship phones after the announcement of former Chinese president Jiang Zemin's death yesterday.

The firm suffered a net loss of 639.1 million yuan (HK$704.2 million) in the first nine months of this year compared to a net income of 16.8 billion yuan a year ago, as it battled a slumping global market and weak demand at home.

Global smartphone sales are set to decline 2.9 percent next year following a 12.2 percent slump in 2022, Jefferies predicted last month.

Lei has made electric vehicles Xiaomi's lodestar for future growth - pledging US$10 billion (HK$78 billion) in investment and spinning off a separate company for the venture.

Source: Bloomberg

https://www.thestandard.com.hk/section- ... ut-delayed

[behappyalways]

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