Xiaomi broke again! Say "the first time the young people doubled"?

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Xiaomi broke again! Say "the first time the young people doubled"?

2018-08-03 10:25:10 163 ℃

Source/Shanghai Securities News

Millet, known as "the first stock of young people", fell below the issue price on the first day of listing It broke again in the intraday on August 2.

At this time, Lei Jun’s rhetoric at the listing celebration feast: "To make the first day of listing Investors who buy shares in Xiaomi Company doubled!", it seems so harsh.

The rice noodle that took a roller coaster ride can't help but ask, is there a good "double" market?

"The first stock of young people" took a roller coaster

Although founder Lei Jun He believes that "Millet is a rare all-round enterprise that can do hardware, e-commerce, and the Internet." "The valuation of Xiaomi should be multiplied by Apple by Tencent," although the final price of Lei Jun will be set. At the lowest of HK$17, Xiaomi still could not escape the fate of the first day.

On July 9, Xiaomi suffered a break when it opened, and then fell to a minimum of HK$16, which was nearly 6% lower than the IPO price, and is very close to the IPO before the F-1 investor entered. The cost price is HK$15.8.

But after that, under the protection of the "green shoe mechanism", Xiaomi began to be invincible. It took only 7 trading days, and the stock price rushed to 22.2 Hong Kong dollars. The market value of Xiaomi also rose from 507 billion US dollars to 703. One hundred million U.S. dollars.

The so-called "green shoe mechanism" is the common name for the market for over-allotment options. In the international market, almost all of the slightly larger new shares will be set up with a “green shoe mechanism” to stabilize the stock price of new shares.

Seeing the soaring rise of Xiaomi, rice noodles seem to see the hope of "the first time the young people doubled."

However, with the approaching price stability period approaching and the sharp decline in global technology stocks, Xiaomi began to stage a diving market, “how to fall up and how to fall down”, only 11 trading days, The stock price will return to the vicinity of the issue price again.

Can Xiaomi “double”?

In the current round of roller coaster market in Xiaomi, the "Green Shoe Mechanism" played an important role in it. According to calculations, in order to "stabilize" the stock price, Xiaomi used 5.6 billion Hong Kong dollars in support funds.

However, Xiaomi announced on the 29th that the stable price period related to the global offering ended on July 28. With the full exercise of the "green shoe mechanism" and the end of the price stability period, where will Xiaomi's share price go?

Southwest Securities:

Millet can compete with US stocks for Amazon. The ecological circle of Xiaomi has just formed, and the two flywheels of Internet service and ecological chain are spinning at a rapid speed. The road to future growth has just begun. But unlike traditional Internet companies, Xiaomi has one dimension (number of device connections). As a new variable in the IOT (Internet of Things) era, the third flywheel based on IOT pan-interconnect and AI pan-intelligence will be explored by Xiaomi. Starry sea. Southwest Securities gave 40% PE valuation of Xiaomi in 2019, corresponding to the target price of HK$30.30/share, and upgraded to “Buy” rating.


Maintaining Xiaomi’s mobile phone shipments in the second quarter of this year rose 49% year-on-year Win the market rating and give a target price of HK$30/share.

Although the organization is still optimistic, many young investors in Xiaomi still choose to leave the market in this round of stock price decline, because they are worried that Xiaomi will not release the financial report released in the middle and late August.

Leijun's tens of billions of equity incentives affect geometry?

The Xiaomi prospectus shows that Lei Jun has made great contributions to the company. Therefore, in April 2018, the company issued 63,959,619 Class B common shares to Smart Mobile Holdings Limited, controlled by Lei Jun, at a consideration of US$1,599.

Xiaomi said in response to feedback from the mainland regulatory authorities that the equity incentives confirmed the payment of 9.827 billion shares. The equity granted to Lei Jun has been issued before the listing and will not dilute the rights of holders of depositary receipts after listing.

Some investors pointed out that Xiaomi’s move may not dilute the rights of depositary certificate holders, but it will definitely affect the performance in the second quarter.

Some analysts believe that Xiaomi’s short-term share price performance is still worth looking forward to. Due to the lock-up period, Xiaomi’s cornerstone investors and original shareholders need to wait at least half a year to ship. Lei Jun has the need to maintain stable stock price and market value management.

From the recent release of "Millet 2018, smartphone shipments in the second quarter increased by 48.8 "%", "Millet announced the march into the air-conditioning field" and other news, you can see that Lei Jun did not give up the dream of a market value of 100 billion US dollars.