20260721-招银国际-MINIMAX-W-00100.HK-NDR_takeaway_upbeat_on_model_upgrade_in_2H26_monetization_on_track_4页_530kb

MiniMax Group (100 HK) Summary

Core Content

MiniMax Group (100 HK) is a Chinese AI technology company that is focused on developing advanced AI models and services. The company is currently in the process of upgrading its M3 model family in the second half of 2026, which is expected to enhance its coding and agentic capabilities, as well as increase model size. The Hailuo 3 video model has completed training and is set for launch in the coming weeks, with capabilities approaching those of Seedance 2.0. This model will integrate with the M3's multimodal features to improve understanding of language and the physical world, leading to more accurate video generation.

Monetization is on track, with the company expecting Annual Recurring Revenue (ARR) to reach US$400 million by the end of May 2026 and US$1 billion by the end of FY26. The current valuation, based on 9x end-FY26 ARR, is viewed as attractive. The company's business model is shifting towards a greater share of enterprise and developer customers, which now account for approximately 60%/40%, compared to 30%/70% in FY25. This shift is driven by strong demand for agent and coding services.

Main Views

• Model Upgrades: The M3 model family will see multiple upgrades in 2H26, focusing on post-training enhancements and scaling.
• Video Model Launch: Hailuo 3 video generation model is expected to be launched soon, with capabilities comparable to Seedance 2.0.
• Monetization Progress: ARR is projected to reach US$1 billion by end-FY26, with enterprise and developer customers growing significantly.
• Valuation Recovery: The company's current valuation is seen as favorable, with a P/S ratio of 27.1x in FY26, and the potential for further valuation recovery.
• Market Access: The company is expected to be included in Southbound Stock Connect in August 2026, which could attract more fund inflows.

Key Information

• Target Price: HK$570.00 (unchanged)
• Current Price: HK$193.10
• Up/Downside: 195.2%
• Shareholding Structure:
  • Yan Junjie: 25.6%
  • Alibaba: 12.8%
• Market Cap: HK$60,563.0 million
• Average 3-Month Turnover: HK$1,484.7 million
• ARR Target: US$1 billion by end-FY26
• ARR in May 2026: US$400 million
• Enterprise/Developer Customers: Increased from 200,000 in end-FY25 to 1 million in May 2026
• Model Enhancements:
  • Post-training upgrades to improve coding and agentic capabilities
  • Scaling upgrades to increase model size
  • Proprietary MiniMax Sparse Attention (MSA) architecture for cost-effective long-horizon tasks
• Financial Highlights:
  • Revenue is projected to grow significantly, from US$31 million in FY24A to US$1,748 million in FY28E
  • Gross profit margin is expected to improve from 12.2% in FY24A to 40.6% in FY28E
  • Adjusted net profit margin is forecast to increase from 800.2% in FY24A to 18.5% in FY28E
  • Operating margin is expected to improve from -820.6% in FY24A to -23.9% in FY28E
• Valuation Metrics:
  • P/S ratio: 27.1x in FY26, 10.4x in FY27, and 4.4x in FY28
  • Current valuation at 9x end-FY26 ARR is considered attractive
• Ratings: The company is rated as BUY, indicating potential for over 15% return over the next 12 months.

Financial Summary

| Current Ratio (x) | 0.5 | 0.5 | 0.3 | 4.1 | 1.7 |
| Receivable Turnover Days | 35.2 | 33.4 | 31.8 | 30.2 | 28.7 |
| Inventory Turnover Days | 3.1 | 3.1 | 3.1 | 3.1 | 3.1 |
| Payable Turnover Days | 26.6 | 26.6 | 26.6 | 26.6 | 26.6 |

Analysts

• Saiyi HE, CFA
• Wentao LU, CFA
• Ye TAO, CFA
• Shuyin GUO

CMBIGM Ratings

• BUY: Potential return of over 15% over the next 12 months
• HOLD: Potential return of +15% to -10% over the next 12 months
• SELL: Potential loss of over 10% over the next 12 months
• NOT RATED: Not rated by CMBIGM
• OUTPERFORM: Industry expected to outperform the relevant broad market benchmark
• MARKET-PERFORM: Industry expected to perform in-line with the relevant broad market benchmark
• UNDERPERFORM: Industry expected to underperform the relevant broad market benchmark

Disclaimer

This report is for informational purposes only and does not constitute investment advice. It is not intended for distribution to all investors and should be used with caution. The information is based on publicly available data and interpretations, and is not guaranteed for accuracy or completeness. CMBIGM does not assume any liability for any loss, damage, or expense arising from reliance on this report. Investors are advised to consult with a professional financial advisor before making investment decisions.