[ET Net News Agency, 31 July 2020] UBS Global Research raised its target price for
Xiaomi Corporation (01810) to HK$15.5 from HK$15 and downgraded its rating to "neutral"
from "buy", given the share price's recent re-rating.
The research house likes Xiaomi's aggressive 5G smartphone push and an internet services
monetisation strategy that few other Chinese smartphone vendors can offer.
UBS believes investors, in the past six months, have shifted focus from India to Europe
given Xiaomi's recently strong smartphone momentum in Europe and its potentially greater
internet service monetisation opportunity than in India.
If Xiaomi can replicate this model in Europe (or India), UBS believes its valuation
could return to listing levels and once again be comparable to internet companies (ie, 30x
PE). (KL)