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<Research> CLSA Raises LENOVO GROUP (00992.HK) TP to HKD21; Quarterly Results Beat; ISG New Growth Driver
Recommend 19 Positive 15 Negative 15 |
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CLSA issued a research report stating that LENOVO GROUP (00992.HK) delivered strong results for its fourth fiscal quarter ended March, mainly driven by margin improvement in its Infrastructure Solutions Group (ISG) and solid performance in its personal computer business. The company targets total revenue of USD100 billion within two years and aims to continue margin expansion. CLSA raised its TP from HKD12.9 to HKD21 and reiterated its Outperform rating. The broker lifted its FY2027 and FY2028 non-HKFRS net profit forecasts by 33% and 25%, respectively, primarily due to higher ISG margin assumptions. The report noted that revenue for the fourth fiscal quarter last year increased 27% YoY to USD21.6 billion, while non-HKFRS net profit surged 101% YoY to USD559 million. During the period, ISG revenue rose 37% YoY to USD5.6 billion, with operating margin reaching a record high of 3.6%, representing the key earnings surprise. Revenue of the Intelligent Devices Group (IDG) grew 24% YoY to USD14.6 billion, with an operating margin of 6.9%. The group expects ISG revenue scale to continue expanding, with long-term profitability likely to catch up with industry leaders. Management expressed confidence in component supply and expects IDG to maintain industry-leading profitability, supported by its strong supply chain, operational efficiency and globally localized manufacturing footprint. LENOVO GROUP disclosed that its AI server pipeline has expanded to USD21 billion and that it has begun shipping Nvidia GB300 NVL72 server racks, targeting delivery of the Nvidia Rubin server platform in 2H26. (ad/da) Auto-translated by AI This article was automatically translated by AI, the original language version should be considered the authoritative version. AASTOCKS.com Limited does not guarantee its accuracy or completeness and accepts no liability for any damages or losses arising from the use of this translation. More Details
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