On June 3, Lenovo Group (00992.HK) fell 6.17% in regular trading, trading at HK$25.9 per share, with trading volume of HK$974 million. The decline comes as profit-taking pressure mounts following the stock's explosive 109% surge in May — its best monthly performance since 1999.

The pullback follows a period of extraordinary gains driven by the company's AI transformation narrative. Lenovo's latest earnings revealed AI-related revenue reaching 38% of total group revenue in Q4, while its ISG business achieved a profitability inflection point after years of heavy AI server investment. Goldman Sachs raised its target price to HK$27 and nearly doubled its target P/E ratio from 7.7x to 15.7x. Market participants had flagged the risk of a sharp reversal after the rapid ascent, with domestic institutional investors reportedly taking profits while short interest stood at 10.33% of total shares as of mid-May.

Despite the retreat, the stock remains well above its pre-rally levels, with its market capitalization still near the HK$300 billion mark. The company's forward P/E of approximately 13x continues to trade at a significant discount to peers such as Dell Technologies at around 30x.

(The above content is based on publicly available market information, generated by a program or algorithm, and is intended solely as a stock movement alert. It does not constitute investment advice or a basis for trading decisions.)