On December 15, Xiaomi Group's share price fell to HK$17.68, down more than half from the high of HK$35.9 at the beginning of the year, and is close to the issue price of HK$17.
It can be said that in the three years of listing on the Hong Kong Stock Exchange, Xiaomi's stock price has experienced a wave of "plunging and soaring and then plummeting", but Lei Jun, the founder of Xiaomi, who was still quite concerned about the stock price, seems to be quite calm about the current dismal stock price performance.
Compared with Xiaomi's stock price, the outside world has recently paid more attention to Lei Jun's successive withdrawal from a number of Xiaomi affiliated companies, including Guangdong Xiaomi Technology Co., Ltd., Guangzhou Xiaomi Communication Technology Co., Ltd., Guangzhou Xiaomi Information Service Co., Ltd., and Zhuhai Xiaomi Communication Technology Co., Ltd.
In this regard, Xiaomi responded that it was a normal change, using the words of Wang Hua, general manager of Xiaomi's public relations department: Lei Jun's energy this year is mainly focused on car-making affairs.
However, judging from the information publicly disclosed by the Hong Kong Stock Exchange, Xiaomi is still buying back its own shares recently, such as spending HK$54.2338 million on December 15 to buy back 3.01 million shares, and spending about HK$49.1708 million to buy back 2.65 million shares on December 14, with a repurchase amount of more than HK$100 million in just two trading days.
It can be seen that Lei Jun and Xiaomi management still care about the stock price, otherwise they would not continue to repurchase shares. However, from the perspective of capital flow, northbound funds from the mainland are the main force of Xiaomi's stock price smashing in the near future, and whether Xiaomi can hold the issue price of HK$17 is still full of uncertainty.
In fact, just a year ago, Xiaomi's stock price was still full of momentum, from 9 Hong Kong dollars at the end of 2019 to 35.9 Hong Kong dollars in early 2021, the maximum increase was as high as 300%, which also made Xiaomi's internal morale extremely high, and Lei Jun set a goal of becoming the first in the global mobile phone market within three years.
On December 15, Xiaomi's stock price fell below HK$18, a new low in 2021, just one step away from the issue price of HK$17, pictured as Xiaomi's stock price.
However, although Lei Jun has never been willing to admit it, the fact is that Xiaomi's sales surge and stock price surge are due to the US sanctions on Huawei mobile phones, and Xiaomi enjoys the dividends of Huawei's sanctions. Especially after Huawei was cancelled by TSMC in September 2020, Huawei mobile phones fell into the desperate situation of "coreless availability", thus giving up a large piece of market share in the global mobile phone market, and Xiaomi is one of the biggest winners.
Even if Huawei tries its best to try to break through the supply chain blockade in the United States, but the market share is still a cliff-like decline, in early 2021, Huawei mobile phones fell from the top three in the world to the top five, and Xiaomi mobile phones successfully entered the top three in the world, and even surpassed Apple to enter the top two in the world in the middle of this year.
Such a market dividend made Lei Jun shout out the slogan of taking the first place in the mobile phone market within three years.
However, the market dividend of Huawei's mobile phone sanctions has actually been released half a year ago, on the one hand, the high-end market is mainly occupied by Apple's iPhone, Xiaomi occupies the low-end market, and faces strong competitive pressure from other brands; on the other hand, the glory mobile phone spun out by Huawei, after restoring the supply chain, has been "full of blood resurrection" and has become an important competitor of Xiaomi.
In addition, Huawei itself has not given up the mobile phone business, still occupies a certain market share in the Chinese market, but also insists on releasing new machines, Huawei and Apple are still dividing China's high-end mobile phone market, making xiaomi difficult in the high-end market.
The bigger problem is that in the face of the "pie in the sky" market dividend, Xiaomi is too optimistic and naïve, especially after the xiaomi stock price soared 300%, Xiaomi's management is not aware of the cruelty of market competition, the difficulty of entering the high-end market is seriously underestimated, and what to do with xiaomi after the dividend fades, lack of contingency means.
From the perspective of market strategy, in the past year, Xiaomi still continues the competitive idea of "cost-effective playing the world", and the performance in the high-end market can be described as pan-good, for example, the folding screen mobile phone MIX FOLD launched by Xiaomi, the high price makes it a store decoration, the sales are quite bleak, and the crazy price reduction of the Xiaomi 12 series and the MIX4 series has made some "rice noodles" old users complain.
In a sense, Xiaomi is a dividend and a loss dividend, and Xiaomi's stock price has returned to the starting point of the 2018 issue price after soaring and plummeting.
In fact, the US sanctions against Huawei are mainly 5G supply chains, trying to use 5G to crush Huawei mobile phones, but there is no direct impact on smart TVs and other fields. It is precisely in the field of smart TV, Xiaomi as a long-term industry leader, in the past year has been greatly competitive pressure, when Huawei and other companies to take smart TV as the focus of products, Xiaomi in product development and brand positioning defects are undoubtedly revealed.
It can be seen from Xiaomi's financial report that the revenue share of the smart TV business has shrunk in the past three quarters, while the proportion of mobile phone revenue has increased, but the growth rate has dropped sharply.
According to xiaomi's previously disclosed third quarterly report in 2021, the single quarter revenue was 78.1 billion yuan, an increase of only 8.2% year-on-year, of which mobile phone revenue was 47.8 billion, a growth rate of only 0.5%, and mobile phones shipped 43.9 million units worldwide, with a growth rate of 5.9%. That is, after the disclosure of this financial report, Xiaomi's stock price has opened a continuous decline.
Imagine, if at the end of March this year, after the disclosure of Xiaomi's 2020 financial report, Lei Jun and Xiaomi management can maintain a relatively sober mind, judge the cruelty of market competition in advance, especially the resilience of Huawei mobile phones and the counterattack of the glory mobile phone, maintain strategic determination for Xiaomi to enter the high-end market, and adopt more stable tactics, perhaps Xiaomi's stock price will not fall into the situation of being cut off.
However, Lei Jun's approach at that time was to choose to build cars, trying to use the concept of new energy vehicles to support Xiaomi's stock price, but from the perspective of investors' reactions, he was not optimistic about Xiaomi's car-making, and choosing to build cars not only consumed Xiaomi's cash flow, but also backfired on Xiaomi's brand and stock price support.
In fact, Lei Jun is an early investor in Xiaopeng Automobile, Xiaopeng Automobile was once regarded as the millet of the new energy automobile industry, taking a step back, Lei Jun can choose to let Xiaomi invest in a company like Xiaopeng Automobile, or even a core accessories manufacturer like Ningde Times, just like Tencent's investment in Meituan and Pinduoduo.
There is no if in commercial competition, Lei Jun finally regards car building as the future of Xiaomi, allowing Xiaomi to cross from the mobile phone industry to new energy vehicles, and shouted out the small goal of listing in 2024.
However, in 2021, when the stock prices of Xiaopeng and Tesla soared, Lei Jun and Xiaomi, who personally built cars, did not enjoy the dividends of the soaring stock prices of new energy vehicle companies, and Xiaomi was still regarded by the capital market as a traditional mobile phone company, and it was also a mobile phone company whose dividends had faded.
If Xiaomi's stock price falls below the issue price of HK$17 again, the pressure on Lei Jun may repeat the scene of 2019.
This time, will Lei Jun still have good luck?