Daiwa: Initiates "Buy" rating on Xiaomi Corporation (01810.HK) with a target price of HK$62.

According to the WiseFinance app, Morgan Stanley released a research report giving a "hold" rating to Xiaomi Group-W (01810.HK) with a target price of 62 Hong Kong dollars. It is widely expected that as memory costs rise, the gross profit margin of smartphones will face downward pressure. However, by looking back at past data, from 2016 to 2017, 2019 to 2021, and 2022 to 2023 periods, when DRAM prices were on the rise, Xiaomi's smartphone gross profit margin actually expanded, believed to be due to the group's effective cost transfer mechanism, as well as significant cost increases driving product price hikes. If the trend reverses, high product prices paired with low costs can also trigger a recovery in the company's profit margin. Morgan Stanley also pointed out that Xiaomi's product structure upgrades and continued high-end strategy are also factors pushing the gross profit margin in a positive direction in the long term.