Morgan Stanley raises Xiaomi target and lists top recommendations

Morgan Stanley raised the target price of Xiaomi Group by 14% from HK$17.5 to HK$20, rating it “overweight” and making it its top recommendation.

Morgan Stanley stated in the report that the increase in the target price was driven by the increase in the valuation of Xiaomi’s electric vehicle business from 90 billion yuan to 110 billion yuan, as well as the synergistic effects of smartphones and artificial intelligence Internet of Things (AIoT).

Morgan Stanley pointed out that although Xiaomi’s electric vehicle was launched slightly later than its competitors, thanks to customer-centric innovation, market feedback has been very positive, and it is believed that Xiaomi’s breakthrough power is emerging.

The report states that production, delivery and service will become key factors in the near term, while continued innovation based on advanced driver assistance systems (ADAS) and smart cockpit performance will be the driver of its long-term value.

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