📱 Xiaomi: Record Profits… But Why Is the Stock Still Weak? Buy the Dip or Avoid the Trap?

$XIAOMI-W(01810)$

Markets are not confused.

They are questioning sustainability.

Xiaomi just delivered:

💰 RMB 39.2B net profit (record high)

📈 +43.8% YoY growth

🤖 Aggressive RMB 60B AI investment plan

And yet...

👉 The stock is drifting lower.

That disconnect is the trade.

🧠 What the Market Is Actually Pricing

This is not about the past.

It is about what comes next.

Right now, the market sees 3 things:

1. 📉 Peak Margin Risk

Record profits often signal cycle highs, not beginnings.

Memory costs rising

Pricing pressure in smartphones

EV business still scaling

👉 Margins may compress from here

2. 💸 AI Spend = Near-Term Drag

RMB 60B into AI is not small.

It means:

Higher capex

Longer payback cycles

Uncertain monetisation

👉 Earnings quality gets questioned

3. 🚗 EV Ambition Still Unproven

Xiaomi's EV story is exciting.

But markets don't reward potential anymore.

They reward:

👉 Delivery + scale + profitability

Until then, it trades at a discount

⚙️ The Hidden Bull Case (What Most Are Missing)

This is not just a phone company anymore.

It is becoming a consumer AI ecosystem

📱 Devices

🏠 Smart home

🚗 EV integration

🤖 AI layer across everything

If executed well...

👉 Xiaomi becomes a China version of Apple + Tesla hybrid

And that is massively underpriced.

⚠️ The Real Risk

This could also be a classic:

👉 “Great results, wrong timing” trade

If macro weakens:

🇨🇳 Consumption slows

📉 Tech sentiment softens

💰 Liquidity tightens

Then strong earnings won't save the stock.

📊 Key Level That Matters: HK$30

This is the battlefield.

🟢 Holds HK$30:

Buyers step in

Narrative resets to“growth + AI optionality”

👉 Upside: HK$36–40

🔴 Breaks HK$30:

Confidence cracks

Momentum traders exit

👉 Downside: HK$26–28

🎯 My Read (What I'd Actually Do)

This is not a chase.

It is a reaction trade.

🎯 Bias: Neutral → Opportunistic Bull

🧠 Strategy: Wait for confirmation at HK$30

⚡ Entry: Only if support holds with volume

Because right now...

👉 Xiaomi is not weak.

👉 It is being repriced.

🔥 Final Thought

The market is asking one question:

👉 Is this peak earnings... or the start of a new AI cycle?

The answer decides everything.

I'm not a financial advisor. Trade wisely, Comrades!

Xiaomi Record Profit, But Stock Still Low: Would You Add at HK$30?

Xiaomi reported its annual results, with adjusted net profit reaching RMB 39.166 billion, up 43.8% year-over-year, marking a record high. However, despite the strong earnings, Xiaomi’s current share price is HK$32, and it has been continuously breaking down after reaching its peak. The company plans to invest RMB 60 billion in AI over the next three years. If memory prices rise beyond expectations, the company may consider raising product prices Can Xiaomi hold HK$30, or will it continue to break down and repeat the “halving curse”? With record-high net profit, would you buy Xiaomi on dips?

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