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DBS reinstates coverage on Lenovo as transformation strategy shows promising outlook

Samantha Chiew
Samantha Chiew5/24/2022 05:14 PM GMT+08  • 3 min read
DBS reinstates coverage on Lenovo as transformation strategy shows promising outlook
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DBS Group Research is reinstating its coverage on Hong Kong listed hardware giant Lenovo Group with a “buy” and target price of HK$11.30, following the group’s latest transformation strategy, which analysts Jim Au and Tsz Wong Tam believe will bring about a promising outlook for the company.

“We re-instate coverage on Lenovo with a ‘buy’ rating due to the new services and solutions business driver not being priced in, its net margin gap with its peers narrowing, and an undemanding valuation of a 6.0x FY2022 PE,” say the analysts.

The tech hardware giant, with the largest share of 23.5% in the global PC market, is transforming into a service-led company by leveraging the world’s largest active PC user base of about 218 million and its strong reputation in hardware products, channelling growth into the services and solutions business.

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