Blue Lotus China New Economy Research, Blue Lotus Research Institute

Eric Wen

Blue Lotus China New Economy Research

China growth and global non-US Internet equities

Blue Lotus Research Institute

Blue Lotus Research is a Hong Kong Type 4 Licensed investment advisory firm focusing on Chinese growth equities and global non-US Internet equities

Equity Bottom-Up

<ul>
<li>Performance of SU7 so far, margin of EV biz and globalization potential prompted us to take another look at Xiaomi and we like what we saw;</li>
<li>Xiaomi surprised during the Investor Day by guiding SU7 gross margin of 5-10%. Delivery guidance also surprised to ship 100k units in 2024. </li>
<li>We raise EV profitability estimates on margin guidance and expect market share to expand as it expands to SUVs.</li>
</ul>


Performance of SU7 so far, margin of EV biz and globalization potential prompted us to take another look at Xiaomi and we like what we saw;
Xiaomi surprised during the Investor Day by guiding SU7 gross margin of 5-10%. Delivery guidance also surprised to ship 100k units in 2024. 
We raise EV profitability estimates on margin guidance and expect market share to expand as it expands to SUVs.


[Xiaomi (1810 HK, BUY, TP HK$20) Rating Change]: Xiaomi EV Came at the Right Time of Consolidation

External broker reports(aggregated public sources), CMB International

CMB International

External broker reports(aggregated public sources)

Incorporated in Hong Kong, supported by the mainland and targeting in global market, CMB International Capital Corporation Limited (“CMBI”) is an integrated financial institution providing comprehensive and professional services. As a wholly-owned subsidiary of China Merchants Bank ("CMB"), by leveraging on the Group’s synergy and coordination in domestic and overseas markets, as well as CMB’s strong resources and outstanding social reputation, CMBI and its subsidiaries have been actively implementing diversified business strategies and set up an overall layout of main business segments including Corporate Finance, Asset Management, Wealth Management, Global Markets and Structured Finance, etc. Adhering to the philosophy of “being clients oriented and increasing our own values by the way of creating value for clients”, CMBI endeavors to provide quality and integrated financial services to institutional, corporate and individual customers both domestic and overseas including Hong Kong IPO sponsorship and underwriting, share placement and rights issue for listed companies, financial advisors, bonds issuance services, asset management, direct investment, wealth management, equity sales and trading, etc.

<ul><li>We attended Xiaomi Investor Day 2024 in Beijing on 23 Apr.</li><li>Key takeaways include: 1) SU7 delivery target: 100k units in 2024 and 10k monthly delivery in June.</li><li>2) SU7 GPM target of 5-10% in 2024. 3) SU7 breakeven at 300-400k sales per year; 4) City NOA available in May and to be rolled out nationwide in Aug; 5) Smart EV sales/service centre: target to cover 46/82 cities by end of 2024; 6) Smart driving team: 1.5k/2k staff by 2024/25 from 1k currently; 7) 2024 guidance: RMB300bn in revenue with RMB24bn in R&amp;D expenses. </li></ul>Content is external broker report sourced from online content aggregator through publicly available sources and is displayed below for general informational purposes only. Refer full disclaimer below.

We attended Xiaomi Investor Day 2024 in Beijing on 23 Apr.Key takeaways include: 1) SU7 delivery target: 100k units in 2024 and 10k monthly delivery in June.2) SU7 GPM target of 5-10% in 2024. 3) SU7 breakeven at 300-400k sales per year; 4) City NOA available in May and to be rolled out nationwide in Aug; 5) Smart EV sales/service centre: target to cover 46/82 cities by end of 2024; 6) Smart driving team: 1.5k/2k staff by 2024/25 from 1k currently; 7) 2024 guidance: RMB300bn in revenue with RMB24bn in R&amp;D expenses. Content is external broker report sourced from online content aggregator through publicly available sources and is displayed below for general informational purposes only. Refer full disclaimer below.

Xiaomi (1810 HK) - Key Takeaways from Xiaomi Investor Day

Overseas Chinese Equities, Aequitas Research

Ming Lu

Overseas Chinese Equities

IPOs and Placements coverage across Asia Pacific

Aequitas Research

We cover all listing across the Asia Pacific along with follow-up placements. As of Dec 2020, our team had covered 539 IPOs with a hit rate of 73.5% and 685 placements with a hit rate of 66.8%.

We combine fundamental bottom-up views with our proprietary quantitative framework to provide a holistic coverage across new listings and placements. Our coverage includes pre-IPO notes before the deal is launched, follow-up analysis once the deal is live and post-listing trading analysis as well.

<ul>
<li>In 1Q24, Xiaomi and Transsion shipments grew rapidly, while <a href="https://www.smartkarma.com/entities/samsung-electronics-co-ltd" target="_blank" data-smartkarma-citation="entities:191:1" rel="noopener">Samsung Electronics (005930 KS)</a> and <a href="https://www.smartkarma.com/entities/apple-inc" target="_blank" data-smartkarma-citation="entities:666:1" rel="noopener">Apple (AAPL US)</a> shrank.</li>
<li>Tims China’s revenue expanded with new openings, which is encouraging in the competitive market.</li>
<li>In China, Tesla fired salespeople who had served the company for less than six months.</li>
</ul>


In 1Q24, Xiaomi and Transsion shipments grew rapidly, while Samsung Electronics (005930 KS) and Apple (AAPL US) shrank.
Tims China’s revenue expanded with new openings, which is encouraging in the competitive market.
In China, Tesla fired salespeople who had served the company for less than six months.


China Consumption Weekly (22 Apr 2024): Xiaomi, Transsion, Tims China, Xpeng, Tesla

<ul><li>Xiaomi officially launched its SU 7 Series electric sedans on 28 Mar, which are priced at RMB 215.9k/245.9k/299.9k for SU7/SU7 Pro/SU7 Max models.</li><li>Its competitive pricing strategy was well-received by the market, and the initial preorders of 50k/89k units in first 27min/24hr are above market expectations, mainly due to its competitive specs, self-developed autonomous driving technology (Xiaomi Pilot), and unique integrated AIoT ecosystem.</li><li>In the near term, we believe investors will focus on pre-order momentum, shipment ramp-up and consumer feedback in next two months.</li></ul>Content is external broker report sourced from online content aggregator through publicly available sources and is displayed below for general informational purposes only. Refer full disclaimer below.

Xiaomi officially launched its SU 7 Series electric sedans on 28 Mar, which are priced at RMB 215.9k/245.9k/299.9k for SU7/SU7 Pro/SU7 Max models.Its competitive pricing strategy was well-received by the market, and the initial preorders of 50k/89k units in first 27min/24hr are above market expectations, mainly due to its competitive specs, self-developed autonomous driving technology (Xiaomi Pilot), and unique integrated AIoT ecosystem.In the near term, we believe investors will focus on pre-order momentum, shipment ramp-up and consumer feedback in next two months.Content is external broker report sourced from online content aggregator through publicly available sources and is displayed below for general informational purposes only. Refer full disclaimer below.

Xiaomi (1810 HK) - Xiaomi EV SU7’s Pricing and Pre-Order Above Expectations

<ul>
<li>Xiaomi released healthy financial results inspite of the shrinking market.</li>
<li>Alibaba Freshippo founder, Mr. Hou, retired from his role as the CEO of Freshippo.</li>
<li>JD began to provide aftermarket service to BYD, the largest new energy vehicle producer.</li>
</ul>


Xiaomi released healthy financial results inspite of the shrinking market.
Alibaba Freshippo founder, Mr. Hou, retired from his role as the CEO of Freshippo.
JD began to provide aftermarket service to BYD, the largest new energy vehicle producer.


China Consumption Weekly (25 Mar 2024): Xiaomi, Alibaba, Xpeng, Maoyan, JD Health, JD.com

China

Xiaomi Corporation manufactures communication equipment and parts. The Company produces and sells mobile phones, smart phone software,  set-top boxes, and related accessories. Xiaomi markets its products worldwide.

Xiaomi Corp (1810 HK)

[Xiaomi (1810 HK, BUY, TP HK$20) Rating Change]: Xiaomi EV Came at the Right Time of Consolidation

Xiaomi surprised during the Investor Day by guiding SU7 gross margin of 5-10%. Delivery guidance also surprised to ship 100k units in 2024.

Blue Lotus Research Institute

Xiaomi (1810 HK) - Key Takeaways from Xiaomi Investor Day

Key takeaways include: 1) SU7 delivery target: 100k units in 2024 and 10k monthly delivery in June. 2) SU7 GPM target of 5-10% in 2024. 3) SU7...

CMB International

China Consumption Weekly (22 Apr 2024): Xiaomi, Transsion, Tims China, Xpeng, Tesla

In 1Q24, Xiaomi and Transsion shipments grew rapidly. Tims China’s revenue expanded with new openings. In China, Tesla fired salespeople.

Ming Lu

Xiaomi (1810 HK) - Xiaomi EV SU7’s Pricing and Pre-Order Above Expectations

Xiaomi officially launched its SU 7 Series electric sedans on 28 Mar, which are priced at RMB 215.9k/245.9k/299.9k for SU7/SU7 Pro/SU7 Max models.

CMB International

China Consumption Weekly (25 Mar 2024): Xiaomi, Alibaba, Xpeng, Maoyan, JD Health, JD.com

Xiaomi released healthy financial results despite of the shrinking market. Alibaba Freshippo founder retired. JD began to provide aftermarket...

Ming Lu