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<Research>Macquarie: XIAOMI-W Placing Backs 2025's Biz Expansion, Rated Buy and Listed as Top Pick
Recommend 23 Positive 36 Negative 20 |
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XIAOMI-W (01810.HK) announced a top-up placing of 800 million shares at HKD53.25 per share, a 6.6% discount to the closing price of HKD57 on the previous trading day (24th). The net proceeds of approximately HKD42.5 billion will be used for business expansion. Macquarie released a research report describing the placing as a strategic move to capitalize on favorable market conditions, strengthen the company’s balance sheet, and support this year’s business development. Xiaomi’s last share placing for fundraising took place in December 2020. According to Macquarie’s prior estimates, Xiaomi’s cash levels in 1H25 are projected to be lower than in 4Q24 due to rising capex, inventory, and receivable levels. As of December 31, 2024, the company was in a net cash position. Given that Xiaomi raised its NEV delivery target for this year from 300,000 to 350,000 units, is constructing a new factory, and plans to open 5,000 Mi Home stores in China in 2025 and an additional 10,000 stores overseas within the next five years, Macquarie assumed investors currently favor companies with strong growth momentum and high liquidity. They are likely to accept the equity dilution from the placing. XIAOMI-W was included in Macquarie’s top picks list, with a Buy rating and a target price of HKD66.75. AAStocks Financial News |
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