On June 24, Lenovo Group rose 4.31% in regular trading, trading at HK$23.36/share, with turnover of HK$148 million. The rally was primarily driven by Bank of America Securities significantly raising its target price and a technical rebound following consecutive sessions of decline.

Bank of America Securities raised Lenovo Group's target price from HK$9.9 to HK$26.5, corresponding to a 16x FY27E P/E ratio, while lifting its FY27-28 earnings forecasts by 70% to 82%. The firm highlighted that Lenovo's Infrastructure Solutions Group (ISG) has achieved profitability with a record-high operating margin of 3.6%. Supported by CPU server and storage demand growth alongside rising AI server contributions, the current profit recovery cycle is deemed more sustainable than previous ones.

Lenovo had previously faced selling pressure after announcing a US$2 billion zero-coupon convertible bond issuance with an initial conversion price of HK$36.70, representing approximately 3.33% potential dilution. The company simultaneously announced plans for share buybacks to offset dilution impacts. Following two consecutive days of pullback driven by dilution concerns and broader sector weakness, the stock saw technical rebound momentum released from oversold levels.

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