Shares of Xiaomi (HK:1810) (OTC:XIACF) listed on the Hong Kong stock markets surged in trading on Tuesday as the launch of its SU7 electric car seemed to send shockwaves through the market.
In another sign of excitement surrounding the launch, the market cap of the smartphone-turned-EV manufacturer has surged to around $52 billion. In comparison, the market cap of traditional automobile companies like GM (NYSE:GM) and Ford (NYSE:F) is at $52.4 billion, and $52.8 billion, respectively.
As Xiaomi enters a crowded EV market in China, the company has priced its SU7 at around $4,000 less than Tesla’s (NASDAQ:TSLA) Model 3 and has claimed that the new EV will have a longer driving range.
According to a CNBC report, Xiaomi’s online store had a waiting time of at least 5 months for a basic version of the SU7. The company had stated soon after the launch that it received orders for more than 50,000 cars in the 27 minutes since sales began of the car.
Xiaomi’s EV Competitors Are Gearing Up
Meanwhile, other Chinese EV majors including XPeng (NYSE:XPEV) and NIO (NYSE:NIO) reduced the prices of their cars by RMB20,000 and RMB10,000 each on Monday.
XPeng and NIO announced their deliveries for March on Monday. XPeng delivered 9,026 vehicles during the month, marking a 29% year-over-year growth. On the other hand, NIO’s vehicle deliveries went up by 14.3% year-over-year in March to 11,866 vehicles. In contrast, BYD (OTC:BYDDY) sold 300,114 EVs in the first quarter of 2024, a decline of 43% from the previous quarter. However, BYD’s Q1 sales increased by 13.4% year-over-year.
Is Xiaomi a Buy, Sell, or Hold?
Analysts remain bullish about XIACF with a Strong Buy consensus rating based on a unanimous nine Buys. Over the past year, XIACF has gained by more than 35%, and the average XIACF price target of $2.65 implies an upside potential of 22.1% at current levels.
