Key Investment Recommendations: Xiaomi Corporation (1810 HK) & Great Wall Motor Company (2333 HK)
As of September 12, 2024, UOB Kay Hian has highlighted Xiaomi Corporation and Great Wall Motor Company as strong trading opportunities for investors. Both companies are poised for growth based on robust financials and favorable technical indicators, making them attractive buy targets for short-term trading.
Xiaomi Corporation (1810 HK)
- Investment Recommendation: Trading Buy
- Target Price: HK$20.20 to HK$21.80
- Stop-Loss Price: HK$17.95
- Current Price: HK$18.96
- Recommendation Date: September 12, 2024
Financial Overview:
Xiaomi reported a stellar first half of 2024, with revenue growing by 32% to RMB88.78 billion. Additionally, the company saw a 20.1% increase in non-GAAP adjusted net profit, amounting to RMB6.18 billion. Xiaomi’s growth trajectory is powered by its competitive product offerings and increasing market share in key global markets.
Stock Analysis:
Technically, Xiaomi is displaying bullish signs. The stock is trading above all major moving averages, and momentum indicators, such as the 14-day RSI and MACD, point toward continued upward momentum. The stock recently broke through key resistance levels and is expected to reach new highs. The buying range between HK$18.80 and HK$18.90 is favorable for entry, with an average holding timeframe of about two weeks.
Earnings Revisions and Risks:
Xiaomi’s earnings are expected to remain strong due to its diversified revenue streams, spanning smartphones, smart home products, and AI technologies. However, potential risks include global economic downturns and intensified competition, which could affect profit margins.
Great Wall Motor Company Limited (2333 HK)
- Investment Recommendation: Trading Buy
- Target Price: HK$12.12 to HK$13.20
- Stop-Loss Price: HK$10.80
- Current Price: HK$11.04
- Recommendation Date: September 12, 2024
Financial Overview:
Great Wall Motor achieved an outstanding 1H24, with revenue increasing by 30.7% to RMB91.43 billion and net profit soaring by 419.5% to RMB7.08 billion. The company’s ability to capitalize on its strong SUV lineup and new energy vehicle (NEV) initiatives has driven its impressive financial performance.
Stock Analysis:
Great Wall Motor’s stock is rebounding after bottoming out at HK$9.70 in early August. The stock has crossed above its 50-day moving average, signaling a potential bullish breakout. Key technical indicators such as the 14-day RSI and MACD suggest growing momentum, supporting a strong buy recommendation at the HK$11.36 to HK$11.44 range.
Earnings Revisions and Risks:
The growth outlook for Great Wall Motor remains positive as the company expands its NEV offerings and strengthens its position in both domestic and international markets. Risks include fluctuating raw material costs and slower-than-expected adoption of NEVs in certain regions.
Broker Information:
This investment report has been prepared by UOB Kay Hian, a leading brokerage firm in Hong Kong. The recommendations are based on comprehensive financial analysis and current market conditions as of September 12, 2024.
