In "The Big Banks," Citigroup lowers SenseTime's target price to 2.7 yuan, with earnings exceeding expectations and a rating of "Outperform the Market."

Citi published a research report indicating that SenseTime-W (00020.HK) performed better than market expectations last year, with a year-on-year revenue increase of 33%, and EBITDA turning positive to RMB 376 million in the second half of last year. Management has a positive outlook for this year, expecting revenue to grow by 25% to 30% year-on-year, and adjusted EBITDA is expected to turn profitable this year.

The bank raised its revenue forecasts for SenseTime for 2026 and 2027 by 4%, to RMB 6.4 billion and RMB 8.2 billion respectively, to reflect accelerated growth in the generative AI business. However, considering the intensified competition in China's AI model industry, the target price was lowered from HKD 3 to HKD 2.7. The bank believes that the company's current valuation is relatively reasonable compared to other Hong Kong-listed AI model peers and maintains an "Outperform" rating