In "The Big Banks," China International Capital Corporation lowered Xiaomi's target price to 56.21 yuan, reflecting concerns about the outlook for traditional smartphone and IoT businesses

Bank of China International's research report indicates that the smartphone industry will face challenges in 2026, primarily due to the "super memory cycle" driving significant increases in DRAM/NAND prices in November and December. The long-term uncertainty of electric vehicle production capacity further exacerbates negative sentiment towards Xiaomi Corporation (01810.HK).

The bank pointed out that as long as Xiaomi's new products (whether electric vehicles, smartphones, or IoT products) can replicate past successes in the mass market, it believes the stock will eventually regain its brilliance. The bank also slightly adjusted its forecasts to reflect the cost pressures of smartphone bill of materials (BOM), uncertainties in electric vehicle production capacity, and vehicle purchase tax subsidy costs; it reiterated a "Buy" rating on the stock, lowering the target price from HKD 69.04 to HKD 56.21.

Regarding the smart electric vehicle business, Bank of China International stated that although the delivery cycle for Xiaomi's main models has shortened and the new order volume is far below capacity, it expects Xiaomi to maintain a product growth cycle next year, benefiting from the launch of several new products; however, it moderately lowered the sales forecasts for 2026 and 2027 to 651,000 and 931,000 units, respectively, to reflect the latest new product launch schedule being slightly later than previously estimated. Considering the downward revision of gross margin forecasts and increased R&D investment related to artificial intelligence, it adjusted the operating profit forecasts to RMB 7.7 billion and RMB 14.9 billion, respectively.

Bank of China International also lowered its adjusted earnings per share forecasts for Xiaomi from 2025 to 2027 by 2%, 14%, and 15%, to RMB 1.65, RMB 1.772, and RMB 2.39, respectively