<Research>CLSA Projects LENOVO GROUP's 3FQ Adjusted Net Profit to Increase by 11% Year-over-Year
Lenovo's Financial Performance: Lenovo Group is expected to report a non-HKFRS net profit of USD480 million for 3QFY26, reflecting an 11% year-over-year increase, with an overall net profit forecast of USD670 million.
Impact of Rising Memory Prices: Despite anticipated pressure on PC margins due to increasing memory costs, Lenovo's strong bargaining power is expected to help maintain its financial resilience compared to competitors.
Revised Profit Forecast: CLSA has adjusted Lenovo's non-HKFRS net profit forecast for FY2026-27 down by 3-6% and lowered the target price from HKD12 to HKD10.3.
Market Rating: CLSA has maintained an Outperform rating for Lenovo, indicating confidence in the company's ability to navigate market challenges.
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LENOVO GROUP Aims to Collaborate with Various AI Model Providers
LENOVO GROUP's AI Ambitions: LENOVO GROUP is aiming to become a leader in AI by forming partnerships with major language model companies globally, as stated by CFO Winston Cheng at the World Economic Forum in Davos.
Potential Partners: The company is considering collaborations with firms such as Humain from Saudi Arabia, Mistral AI from Europe, BABA-W, and DeepSeek to enhance its AI capabilities.
HSI Rises by 97 Points Driven by Demand for Chip, AI, and Robotics Stocks; HUA HONG SEMI Gains 5%
Market Performance: The Hong Kong stock market saw a rebound with the HSI rising 0.4% to 26,585, driven by the US-Europe dispute over Greenland and a total market turnover of HKD250.451 billion.
AI and Tech Stocks Surge: The launch of the new DeepSeek model, MODEL1, boosted AI and chip-related stocks, with notable gains from companies like SENSETIME-W and INSILICO, while some stocks like UNISOUND experienced declines.
Chinese Exports Growth: China's exports in December increased by 6.6% year-on-year, surpassing the previous value of 5.9% and exceeding forecasts of 3%.
Mixed Performance Among Major Tech Firms: BIDU-SW launched a new AI feature and saw a 3.3% stock increase, while other tech giants like TENCENT and JD-SW had modest gains, and NTES-S faced a significant decline of 3.7%.
