Goldman Sachs has released a research report significantly raising its forecasts for LENOVO GROUP (00992) for the fiscal years 2027 to 2029. The investment bank has increased its non-HKFRS net profit projections by 56%, 63%, and 89% respectively, while revenue forecasts have been lifted by 15%, 12%, and 15%.

This revision reflects the company's gaining market share, an ongoing product portfolio upgrade, and the support of AI-integrated solutions driving AI server growth, alongside expected expansion in the AI PC and storage businesses. As a result, Goldman Sachs has raised its price target for LENOVO GROUP by a substantial 64.5%, from HK$31 to HK$51, which corresponds to a 18.5 times forward P/E ratio for the 2027 fiscal year. The firm maintains a "Buy" rating on the stock.

The strong performance of LENOVO GROUP in its first fiscal quarter ending June 30 has confirmed the bank's positive outlook. Despite high memory costs, the Intelligent Devices Group (IDG) business maintained an operating profit margin of 7.1%, with revenue growing 27% year-on-year. Goldman Sachs anticipates that continued industry consolidation, combined with the product portfolio upgrade, will drive the company's personal computer business growth to outperform its peers.

The bank further expects that the revenue growth for LENOVO GROUP's Infrastructure Solutions Group (ISG) business will remain robust, primarily benefiting from steady demand for general-purpose servers, the ongoing product portfolio upgrade, and an expanding client base for AI servers.