Goldman Sachs Group indicates that hedge funds are ramping up bearish bets on XIAOMI-W (01810) as caution grows ahead of its earnings release. According to a Wednesday report from Goldman's sales team, short positions against the company in its prime brokerage book jumped 53% over the past week. The report also revealed net selling by institutional investors, led by pension funds and hedge funds, over the past two weeks.

Hedge funds cited XIAOMI-W as a "consensus short/sell target in the near term due to lack of catalysts," with concerns over security issues, factory production delays, and sluggish demand for its electric vehicles despite recent promotional campaigns weighing on sentiment. Market optimism has sharply deteriorated compared to earlier this year when enthusiasm over XIAOMI-W's entry into the EV sector drove its shares higher. Since peaking in early July, the stock has plunged more than 25%.

Goldman Sachs analysts recently cut their price target for XIAOMI-W by over 10%, citing margin pressures from rising memory chip prices. The smartphone and EV maker is set to report Q3 earnings on November 18, with consensus estimates projecting a 23% year-on-year revenue increase.