小米集团-W(1810.HK):手机出货量复苏 IOT毛利率提升带动整体利润稳健

Xiaomi Group-W (1810.HK): Mobile phone shipments are recovering, IOT gross margin increases driving steady overall profit

中信建投證券 ·  May 9  · Researches

Core views

We expect Xiaomi's 24Q1 revenue to be 75.4 billion yuan (YoY +27%), of which mobile phone, IoT, and internet revenue are expected to be 466/202/80 billion yuan (YoY +33%/+20%/+14%) respectively; although mobile phone gross margin declined month-on-month due to BOM costs, the gross margin is expected to continue to rise to 22% (YoY+2.5 pct) under rising IOT gross margin and revenue structure adjustments (YoY+2.5 pct); net profit after Q1 adjustment is estimated to be 5.6 billion yuan (YoY +74%), and vehicle construction costs are 2.5 billion yuan Yuan, net profit corresponding to core business after adjustment was 8.1 billion yuan (YoY +88%).

SU7's sales volume and gross margin both exceeded expectations, and this year's delivery target was greater than 100,000 units.

Brief review

Mobile phone business: Strong growth in shipments and steady gross margin. According to IDC, shipments of 2024Q1 Xiaomi phones were 40.8 million units, yoy +33.8%, a year-on-year increase of more than 10 million units in a single quarter, and the market share increased to 14% (yoy+3pct), ranking third in the world. On the one hand, the strong increase in shipment volume is due to the company's outstanding performance in emerging markets such as Latin America and Africa, and on the other hand, it has benefited from a low base during the inventory removal cycle in the same period last year. On the ASP side, benefiting from the continued advancement of high-end strategies, ASP at home and abroad is expected to increase. Considering the increase in overseas shipments, the overall ASP for Q1 is expected to remain flat compared to the same period last year. Gross margin declined month-on-month due to BOM cost increases, but remained high year-on-year, and is expected to be 14.5% (yoy+3.3pct/qoq-1.9pct).

AIoT & Internet business: Growth is high, and rising gross margins drive profit improvement. Driven by core categories such as tablets, wearables, and major appliances, as well as repairs after the overseas inventory clearance cycle, the 24Q1 AIoT revenue is estimated to be 20.2 billion yuan (yoy +20%), and gross margin rises to a record high of 18% (yoy+2.3pct/qoq+4.1pct). Considering the strong increase in shipments and the upward trend in the share of high-end mobile phones, we expect the 24Q1 Internet business revenue to be 8 billion yuan (yoy +14%), and the gross margin remains high at 75%.

SU7 sales surpassed expectations. This year's delivery target was greater than 100,000 units, and gross margin exceeded expectations.

As of 4.30, the number of SU7 locks had exceeded 88,000, with women accounting for 28% of car buyers, 29% of BBA car owners, and 52.5% of Apple users, driving the brand to further break the circle among high-end and female users. In terms of delivery, 7058 units were delivered in April, and the target is to reach 10,000 units per month starting in June, reaching 100,000 units throughout the year. The delivery pace is superior to the industry level. Driven by supply chain support and sales exceeding expectations, SU7's gross margin is expected to reach 5%-10%, exceeding previous market expectations. We are optimistic about the car building growth space under Xiaomi's “full ecosystem of people and cars” strategy.

Profit forecast and valuation: With mobile phone shipments and ASP increasing at the same time as the Internet business accelerates monetization, we expect Xiaomi Group's 2024/2025 revenue of 3277/383.9 billion yuan (yoy +21%/+17%), adjusted net profit of 159/17.8 billion yuan (yoy -17%/+12%), estimated investment in car construction and other new businesses in 2024 to be 11 billion yuan, and adjusted core business net profit of 26.9 billion yuan (yoy +4%). We gave the company a “buy” rating for the core business of 15xPE for 24 years, 2x PS for the car for 24 years, and a target price of HK$22.9.

The translation is provided by third-party software.

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