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Lenovo Group (HKSE: 992) saw its share price fall more than 10% again today. As of now, the company's stock price stands at HK$22.94, and its market capitalization has dropped below HK$300 billion.
On October 16, 2026, Legend Holdings (HKSE: 3396) purchased 30 million shares at an average price of HK$27.3673, for a total amount of HK$820 million. Following this purchase, Legend Holdings' shareholding ratio increased from 44.94% to 45.17%. Based on the current stock price, this investment by Legend Holdings shows a paper loss of 16%, amounting to a paper loss of RMB 132 million.
Lenovo Group's stock price had reached a high of HK$37.8 on September 18, 2026. In just one month, Lenovo Group's stock price has retreated by nearly 40%.
The core driver of this round of Lenovo Group's stock price surge began in May 2026. Earlier, the continuous rise in Lenovo Group's stock price was not primarily due to its business performance, but rather because Lenovo Group holds the status of being Nvidia's exclusive agent in mainland China, riding the fast track of "AI infrastructure."
Previously, an announcement released by Lenovo Group showed that in the second quarter of 2026, Lenovo Group's revenue reached RMB 183.4 billion, a year-on-year increase of 43%; adjusted net profit for the quarter exceeded the US$1 billion mark for the first time (approximately RMB 7.3 billion), a year-on-year increase of 176%; adjusted net profit margin was 4.0%. Lenovo Group's revenue growth across various regional markets ranged between 25% and 58%, representing a high-speed growth range. Based on the growth momentum in the first fiscal quarter, the group expects to achieve ahead of schedule its established goal set at the beginning of the fiscal year of "exceeding US$100 billion in revenue within two years."
However, as market concerns over AI financing costs and returns on capital expenditure are being concentrated and released, when funds retreat, the entire sector is also impacted. In addition, Lenovo Group's stock price has already risen several times this year, and the stock itself has a bubble. When it pulls back, the stock price also falls sharply.
Moreover, the latest preliminary data released by International Data Corporation (IDC) recently shows that global personal computer (PC) shipments in the third quarter of 2026 were 62.7 million units, a year-on-year decline of 20.1%. This is the second consecutive quarterly decline, and the decline is significantly larger than the 3.8% drop in the second quarter.
Recently, Citi lowered Lenovo Group's target price by 20% from HK$50 to HK$40, to reflect the potential dilution effect from convertible bonds and warrants as well as the latest valuation.
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