Xiaomi: Future-Proof EV Strategy Impresses Goldman Sachs

Goldman Sachs raises the 12-month price target for Xiaomi from HK$24.7 to HK$27.5, citing performance in the electric vehicle (EV) sector that exceeds expectations. The company is achieving early successes with its “Human x Car x Home” strategy, which is bearing fruit both in China and internationally. The bank maintains its buy recommendation for Xiaomi stock, as the company shows impressive progress in the EV market. There is a justified expectation that deliveries of the SU7 EV and the introduction of new products will provide positive momentum. In particular, the production capacity of Xiaomi's initial manufacturing phase is set to be further increased to meet strong demand. In October alone, 20,000 SU7 deliveries are expected. Additionally, Goldman anticipates an innovative SU7 Ultra model to be unveiled at the Nürburgring in October, along with a second EV that will enter the market sooner than expected. Goldman Sachs sees further growth potential with the launch of the Xiaomi 15 smartphone series, projected to achieve high sales numbers as a successor to the successful Xiaomi 14 series. Overall, Goldman Sachs expects Xiaomi's EV business to grow significantly and reach an estimated value of $18.5 billion. These positive prospects, combined with favorable operational leverage, lead to optimistic earnings forecasts and support the continued positive valuation of Xiaomi stock.