Country Daily
China Consumer Household Durables/AIA Group/Alibaba Group/Tencent Holdings
Top Stories
Sector Update | Household Durables
For 2Q26, we expect household durables companies’ sales growth to remain on track, with overseas sales offsetting weakness in the domestic market. We forecast low- to mid-single-digit growth for Midea, and flat to low single-digit growth for Haier. Rising raw material costs and foreign exchange losses are expected to weigh on bottom line performance. We forecast a low single-digit net profit growth for Midea on a reported basis (including fair value gains). Maintain OVERWEIGHT. Our top pick is Midea.
Company Update | AIA Group (1299 HK/BUY/HK$73.70/Target: HK$100.00)
China’s tightening of outbound investment regulations triggered a selloff in AIA due to market concern over the impact on its MCV business. We do not expect a total shutdown, given that there are no changes to the regulatory framework governing cross-border insurance. In the worst-case scenario, our 2027 EV and VONB forecasts would fall by 8%/21%, resulting in a 14% target price reduction. We believe this regulatory risk is overblown, making AIA's valuation increasingly attractive. Maintain BUY; target price: HK$100.00.
Company Update | Alibaba Group (9988 HK/BUY/HK$107.50/Target: HK$190.00)
Alibaba’s 1Q27 outlook appears stronger than expected, with resilient CMR and narrower EBITA pressure suggesting easing subsidy intensity, while cloud growth is expected to accelerate to 45% yoy with margin improvement. Beyond nearterm earnings, Alibaba is expanding its AI ecosystem through data centres, AI-powered Alipay, Qwen-Robot and Bailian’s partnerships with leading AI labs, supporting broader cloud demand and token-based monetisation visibility. Maintain BUY with a higher target price of HK$190.00 (US$194.00).
Company Update | Tencent Holdings (700 HK/BUY/HK$473.80/Target: HK$680.00)
Tencent’s Hy3 official launch marks visible progress in foundation model capabilities, supported by a stronger benchmark performance, coding and agent upgrades, and competitive pricing. Broader deployment across Tencent’s ecosystem supports real-world usage feedback and faster model iteration. Early traction, including 20x token growth and 6x growth in users voluntarily selecting Hy3, suggests improving user acceptance and stronger relevance in enterprise productivity and workflow-oriented AI use cases. Maintain BUY with a higher target price of HK$680.00.
Technical Analysis
Lenovo Group | 992 HK
Support levels: HK$20.06/HK$19.68
Resistance levels: HK$26.32/HK$27.42
KE Holdings | 2423 HK
Support levels: HK$37.98/HK$37.04
Resistance levels: HK$45.18/HK$48.72.
IMPORTANT NOTICE - DISCLOSURES AND DISCLAIMERS
This report is provided subject to, and must be read together with, the full Disclosures / Disclaimers available at the following link: https://research-api.uobkayhian.com/assets/disclaimer/0e6d602f-adeb-45f8-9dea-5d5591daae87, which are incorporated by reference into this report. In particular, this report is intended for general circulation and informational purposes only and does not constitute personal investment advice or a recommendation to buy or sell any investment product or security. You should independently evaluate the information and, where necessary, seek advice from a qualified financial adviser regarding the suitability of any investment. Analyst certifications required under applicable regulations, including SEC Regulation AC (where relevant), are included in this report. By accessing, receiving or using this report, you acknowledge that you have read, understood and agreed to be bound by the Disclosures / Disclaimers, as may be amended, supplemented or updated from time to time.
