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Lenovo responded to the rejection of Hang Seng Index: no long-term substantive impact on stocks.

via:CnBeta     time:2018/5/4 20:41:10     readed:257

Responding to claims that the company is more concerned about the continuous transformation of the company

Lenovo responded: "respecting the results of the Hang Seng Index, but paying special attention to the continuous transformation of the company and bringing sustainable long-term returns to shareholders. We believe that the results of the Hang Seng index will not have a long-term substantive impact on our stock performance.

In fact, we see that the company's business performance is steadily improving. The latest third quarter report shows that Lenovo has returned to the rising channel with a single quarter revenue of $12 billion 900 million, a new high of three years, and a pre tax profit of $150 million, a significant increase of 48.5% over the same period.

From the perspective of business development, Lenovo's "three wave strategy" has been effectively implemented. At the same time, Lenovo is also actively distributing channel changes, promoting the rapid landing of smart retail, promoting the integration of online and offline channels, digital and intelligent changes, and further effectively improving the sales efficiency and customer experience level. With the further implementation of the "three wave strategy" and the gradual improvement of the construction of new business core competence, Lenovo is entering a new stage of strong performance and sustainable growth.

The analysis believes that the key areas are in trouble

This is not the first time Lenovo has been kicked out of the Hang Seng Index.

In 2000, Lenovo joined the Hang Seng Index for the first time. In 2006, Lenovo was kicked out of the Hang Seng Index. In March 2013, Lenovo joined the Hang Seng index again.

In the 5 years since then, Lenovo's share price has fallen by 56%, and its market value has lost 5 billion 800 million US dollars. Bloomberg data showed that in the past 10 years, the share price of the Hang Seng index was 48% lower than before.

In the near future, Lenovo shares fell to the lowest level since October 2009, and the U. S. ban on some Chinese companies has exacerbated investors' worries about China's science and technology sector.

According to IHS Markit Ltd, the stock is one of the most empty stocks in the Hang Seng Index Stocks: 13.8% of the circulation shares were borrowed to the short sellers. If you get rid of it, you can cause more selling. According to data compiled by Peng Bo, at least $107 billion worth of passive funds track the Hang Seng Index.

Kenny Wen, a Hongkong based strategist at Hon Hong Kong, said, "Lenovo has trouble in all key areas from a fashion smart phone to keeping the market share of the computer business."

Yang Yuanqing said the hard times had passed

But Lenovo Group CEO Yang Yuanqing may be optimistic.

Since April 10th this year, Lenovo has held four global oath conventions in 10 days, including Rowley, Athens, Beijing and Tokyo.

Yang Yuanqing proposed that Lenovo will fight four major battles in the new fiscal year: the personal computer continues to maintain the leading profitability, the mobile business is actively seeking, the data center can achieve sustainable profit growth, and artificial intelligence creates new competitiveness.

"We have spent the hardest period of Lenovo," he said at the conference. From last year's performance reports, Lenovo has shown better data, the highest turnover in three years, the North American Latin American market, Lenovo PC in 11 countries before the market three, smart hand machine in the top three in 4 countries, "we are The road of development in the future should not only advance, but also develop upward. "

In an interview with Sina Technology, Yang Yuanqing confessed that Lenovo's mobile phone business and data center business got a very high starting point through merger and acquisition. "But you have to digest them well to really become your thing, not only to understand the business, but also to build competitive power. That's your business. In the past few years, Lenovo has come back to the consolidation period from 2005 to 2008, but I think this consolidation period is inevitable and valuable.

The following is the response of the Lenovo Group to the full text:

We respect the results of the Hang Seng Index, but we are particularly concerned about the continuous transformation of the company and the sustainable long-term returns for shareholders. We believe that the results of the Hang Seng index will not have a long-term substantive impact on our stock performance.

In fact, we see that the company's business performance is steadily improving. The latest third quarter report shows that Lenovo has returned to the rising channel with a single quarter revenue of $12 billion 900 million, a new high of three years, and a pre tax profit of $150 million, up 48.5% from a year earlier.

In terms of business progress, Lenovo's "three-wave strategy" has been effectively implemented: first, Lenovo's PC business growth is higher than the average market growth rate, while maintaining the industry's leading profitability; second, Lenovo data center business achieved high double-digit growth, becoming the group's second largest profit growth engine, including the HPC high-performance computing field for the fourth consecutive year in China, the world's number two achievements; mobile business, Lenovo has achieved more than 30 percent year-on-year growth in North America and Western Europe, and a more impressive performance in Latin America, with annual sales growth eight times higher than in the market. In the first three quarters, profits rose 40 percent year on year, ranking second in the four largest countries in Latin America. Third, Lenovo was in the "third wave" business, in which the "equipment cloud" and "infrastructure cloud" were the direction of intelligent change. Significant progress has been made, with non-device sales from software and services reaching $408 million, up nearly 9% from a year earlier. In the face of the coming era of intelligent couplet, Lenovo is laying out the SIoT market in an all-round way to build an open intelligent ecology, in which Lenovo Mirage AR, which Lenovo works with Disney, has its head on the table. Since its launch, it has become the world's largest smartphone in the market, with global sales of $70 million. At this year's CES show, Lenovo won 80 official CES awards, topping Chinese companies in total, and nearly 70 percent of the winning products were new smart products developed by the group, including the Mirage AR Mirage Solo VR and its Mirage Camera- Smart Dispaly smart display.

At the same time, Lenovo is also actively distributing channel changes, promoting the rapid landing of smart retail, promoting the integration of online and offline channels, digital and intelligent changes, and further effectively improving the sales efficiency and customer experience level.

With the further implementation of the "three wave strategy" and the gradual improvement of the construction of new business core competence, Lenovo is entering a new stage of strong performance and sustainable growth.

Related articles:

Lenovo Group was excluded from the Hang Seng index component.

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