Xiaomi share price (HKEX: 1810) a good buy now?

Is Xiaomi share price (HKEX: 1810) at a good entry level now? My last coverage on Chinese tech stocks (Alibaba HKEX: 9988) was in February 2021. Back then, Chinese tech stocks were embroiled in a slew of regulatory headwinds following Jack Ma’s epic criticism against the regulators’ stifling innovation of the financial system. That action triggered an unprecedented storm that saw aggressive regulatory clamp downs on Chinese tech stocks.

Obviously, nobody in his right mind would have predicted the storm to last for two years. During this period, it is understandable that many investors are depressed after seeing their investments evaporated with the meltdown of Chinese tech stocks. Against this backdrop, many investors must be praying fervently for light at end of the tunnel. Recently, an SG Wealth Builder Lifetime Member requested for the coverage on one of the Chinese tech stocks: Xiaomi share price (HKEX: 1810), which I will duly oblige.

Admittedly, I have not invested in foreign stocks before, much less Chinese tech stocks. However, I have been watching the unfolding of the rout of Chinese tech stocks for the past two years. Like many Chinese tech stocks, Xiaomi share price (HKEX: 1810) had suffered huge carnage due to the crisis of confidence in Chinese tech stocks. However, recent announcement by the Chinese authorities to roll out policies to support the economy and stabilize consumption gave many investors some glimmers of hope that the slew of regulatory clamp downs may be coming to an end (finally)!

In investing, it is important to buy low and sell high. Xiaomi share price (HKEX: 1810) has plunged from an all-time high of HK$33.20 on 31 December 2020 to the current HK$11.70. This represents a staggering 45% correction from the all-time high. Although Xiaomi share price (HKEX: 1810) is at a very interesting valuation right now, it is important to examine the landscape and operating environment before jumping onto the bandwagon.

For background, Xiaomi principally engaged in the research, development and sales of smartphones, Internet of things (IoTs) and lifestyle products and the provision of Internet services. In March 2021, Xiaomi announced its entry into the electric vehicles market. Currently, their smart electric vehicle research and development team exceeds 1,000 people.

According to Canalys, in 2021, Xiaomi’s smartphone shipments ranked No. 3 globally with record-high market share of 14.1%. Samsung remained the top player while Apple came second. In mainland China, Xiaomi was ranked No. 3 in smartphone shipments and their market share increased to a record high 15.2% from 12.1% in 2020. In salient, Xiaomi’s competitive edge is in the development of smartphones and its strategic advantage is being based in China.

Note that this is an opinion article and not meant to be a financial advice. Please do your due diligence or engage financial advisors before investing in the stock market. Furthermore, I am not vested and have never invested in Xiaomi before. Whether Xiaomi share price (HKEX: 1810) will surge or collapse has no impact on me. Thus, this article is not meant to induce readers to make any form of investment decisions.

Xiaomi share price (HKEX: 1810) faces long winter?

While the purported easing of Chinese regulatory headwinds saw various Chinese tech stocks rebounding, Xiaomi share price is still singing the blues. Why is this so? Apparently, out of nowhere, the [This is a premium article. The rest of the content is blocked and can be accessible by SG Wealth Builder Members only. To read the full content, please sign up as member.]

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Updated: May 5, 2022 — 8:58 am

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