Chart of the Week: Xiaomi Shares See Strong Buying Interest

The smartphone industry has had a tough 2020 so far as Covid-19 forced China into a lockdown. Often seen as the “world’s factory”, China’s place in the smartphone supply chain is indispensable.

Now that the world’s second-largest economy is slowly coming back online, handset makers have come back into focus.

Xiaomi Corp (SEHK: 1810), a Chinese handset manufacturer that has built its growth story around the Internet of Things (IoT), is one of the world’s largest producers of smartphones.

The company listed in Hong Kong back in the middle of 2018, pricing shares at HK$17 each. However, since then it has struggled in the shadow of fellow handset producer Huawei (which is unlisted).

Xiaomi shares, though, this week saw a gain of over 10% as investors bought back into the company’s story. Despite that, it’s still well below its IPO price (see below).

Shares gained strongly because the firm launched its newest model – the Mi 10 – in India. The launch had been delayed due to the lockdown in India (the model first appeared in China three months ago).

As the world comes out of lockdown, many eyes will be on the massive Indian market. Xiaomi derives about a third of its sales from the fast-growing Asian market.

Can Xiaomi continue to grow its appeal to investors on the back of the Indian market’s potential?

Xiaomi stock price

Source: Google Finance

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