Cathay Securities and Haitong Securities: Maintain "Buy" rating on Xiaomi Corporation-W with a target price of HKD 77.5

According to the Zhitong Finance APP, Guotai Junan released a research report stating that it maintains Xiaomi Corporation-W (01810) FY2025E-FY2027E revenue estimates at RMB 489.1 billion / 641.8 billion / 758.4 billion respectively; it maintains adjusted net profit forecasts at RMB 45.4 billion / 68.1 billion / 83.6 billion. With stable deliveries of Xiaomi cars, maintaining competitive advantages in major appliances, and the launch of new mobile phones potentially becoming an important catalyst, the firm maintains a target price of HKD 77.5 for Xiaomi and a "Buy" rating. Key Points from Guotai Junan: 7, 8 months of stable car deliveries above 30,000 units, optimistic about achieving and exceeding the annual delivery target of 350,000 units smoothly Xiaomi's car deliveries in July and August exceeded 30,000 units consecutively, mainly due to the capacity flexibility released by the first-phase factory. Since the Yu7 and Su7 both belong to the Modena platform, based on the supply chain experience, production line experience, and component reuse rate accumulated in the first phase, the firm expects the second-phase factory's capacity ramp-up to be faster than that of the first-phase factory. The firm is optimistic about Xiaomi's ability to smoothly complete and exceed the annual delivery target of 350,000 units in 2025. Rapid increase in air conditioning volume while continuously improving structure, Wuhan factory will strengthen Xiaomi's competitive advantage in major appliances Xiaomi's air conditioning shipments in Q2 25 exceeded 5.4 million units, a year-on-year increase of 60%, with growth rates exceeding 50% for three consecutive quarters. As the most important category of Xiaomi's major appliances, air conditioning will continue its high-end strategy, continuously narrowing the price gap with leading brands, and improving its structure. Meanwhile, the Wuhan major appliance factory is about to be put into production, which will fill the weak link in production, combined with Xiaomi's new retail model channel advantages, the firm continues to be optimistic about Xiaomi's competitive advantage in the major appliance category. The launch of new mobile phones may become an important catalyst in the future The upcoming Xiaomi 17 Pro and ProMax feature a back screen that can display customizable content, including clock themes and various personalized patterns, and can control cars and assist in rear camera selfies. After the official announcement of the Xiaomi 17 series, the cumulative deposit blind order volume at Xiaomi stores has doubled compared to the previous generation. With the subsequent launch of new Xiaomi and Redmi series products, the firm believes that Q4 mobile phone revenue and gross margin performance are expected to improve marginally. Risk Warning: Car sales may fall short of expectations; risk of intensified competition; risk of AI progress not meeting expectations; geopolitical and regulatory risks