Daiwa: Initiates coverage on MiniMax-W (00100) with a Buy rating and a target price of HKD 530, as it is one of the few stocks benefiting from the commercialization trend of domestic AI, specifically pure AI large model stocks.

Daiwa has released a research report stating that it initiates coverage of MiniMax-W (00100) with a "Buy" rating and a target price of HKD 530. The report highlights that the company focuses on competitive model capabilities and cost-effectiveness, making it one of the few pure AI large model publicly traded companies benefiting from the trend of AI commercialization in China. Daiwa believes that the recent weakness in the stock provides an attractive entry point relative to the company's fundamentals and growth prospects, and that the upward catalysts over the next 12 months should support a reevaluation of the valuation. The report indicates that MiniMax has steadily narrowed the capability gap with leading model developers in the West while maintaining a strong cost-effectiveness advantage. Despite significantly lower R&D expenditure and fewer resources, its flagship M3 model remains competitively ranked in global benchmark tests, highlighting the company's strength in model development and execution. The firm believes MiniMax's differentiated value-for-money positioning allows it to effectively capture the growing demand for AI, particularly from cost-sensitive enterprises and developers. The firm projects that the company will achieve a compound annual growth rate (CAGR) of 180% in total revenue from 2025 to 2029, with revenues from open platforms and AI enterprise services expected to grow at a CAGR of 232% during the same period, surpassing the CAGR of 138% for AI-native products from 2025 to 2029. Furthermore, it anticipates continuous improvement in the company's profit margins from 2026 to 2028, benefiting from operational leverage brought about by the acceleration of commercialization.