[ET Net News Agency, 6 January 2021] UBS Global Research lowered its target price for
Xiaomi (01810) to HK$22 from HK$23 and downgraded its rating from "neutral" to "sell".
The research house said Xiaomi's share price rose 208% in 2020, outperforming MSCI China
IT by 132ppt. UBS believes the shares, at 42x/33x consensus 2021/2022 PE, are pricing in
material earnings upgrades driven by a recovery in internet services (in China and/or
rapid acceleration in overseas monetisation).
While it expects Xiaomi to resume monthly active user (MAU) growth in China in 2021, the
research house identified several headwinds (1) a shift in China's mobile game economics
away from app store operators; (2) China's fintech regulations; and (3) timing of Xiaomi's
Europe MAU scale expansion.
UBS said investors are willing to pay for Xiaomi's business growth (ie, 30x PE), but it
believes HK$1.10 EPS is unlikely in 2021 (it is challenging even in 2022). (KL)
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01810 XIAOMI-W
Nominal 
16.180 +0.360 (+2.276%) Research Report
06/01/2021 14:21
{I-bank focus}UBS downgrades Xiaomi (01810) to HK$22
| Remark: | Real time quote last updated: 23/04/2024 17:59 |
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