DBS: Lenovo Group will benefit from the upgrade cycle in 2025, with a Buy rating

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Jinshi data news on February 24th, DBS published a research report indicating that Lenovo Group (00992.HK) 2025 fiscal third quarter revenue increased by 20% to US$18.8 billion, and net profit increased by 105.6% to US$693 million. The bank expects that integrating DeepSeek into Lenovo’s AI assistant Xiaotian for personal computers will help increase the company’s penetration in the AI personal computer market and provide customers with better AI functions. The bank believes that DeepSeek will drive long-term demand for AI servers by lowering the entry barriers and accelerating the adoption of enterprise AI through proprietary AI model development. The bank raised its profit forecast for the 2025 fiscal year by 8.4%, reflecting a one-time deferred tax offset. The bank believes that Lenovo will benefit from the upgrade cycle in 2025, and the rise in services and the recovery of PCs will drive a revaluation of the valuation, with a target price of HK$17.2 and a buy rating.

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