With micromotor technology as the core, the company that expanded the cleaning business and motor technology product business initially started with the automobile cleaning business and formed a rich product matrix based on the original micromotor technology to actively adapt to the trend of automobile intelligence. The company lays out motor module products with a higher degree of vertical integration. Smart Driving has developed ADAS active sensing cleaning business, continuously expanding the company's new application scenarios for micromotor technology and fluid technology, while also mastering the manufacturing capabilities of thermal management cooling manifolds. Among them, the cleaning business and the micromotor business are the two core businesses, accounting for 52.98% and 36.34% of revenue in 2022, respectively.
Actively promote industrial chain integration, expand customer resources and production capacity layout The company adopts a platform-based product strategy to standardize components, and at the same time forwardly lays out emerging magnetic materials and harmonic magnetic field motor technology as core materials for motors to improve the autonomous, synchronous, and experimental research and development capabilities of this product. The company actively expands customer resources at home and abroad, and supplies supporting products to well-known domestic automakers and world-renowned multinational auto parts suppliers through tier 1 and tier 2, such as Great Wall Motor, Geely Automobile, Xiaopeng/Stabilus, and Qingbo wipers.
Micromotor business: In line with the trend of automotive intelligence, expand the intelligent trend of automotive micromotor application scenarios and catalyze the incremental demand for automotive micromotor application scenarios to improve the convenience, comfort and sense of technology of the vehicle. Intelligent configurations are rapidly penetrating, and more and more players are actively deploying application scenarios for micromotors in automobiles. The scenarios have expanded to include categories, chassis, seats, thermal systems, and cleaning systems. The company has developed many application scenarios in the field of “four doors and two covers” for car bodies, and has evolved from a single motor to a “motor+actuator” integration. We estimate that the company's current domestic market for intelligently configured micromotor products will be 986 million yuan in 2023, with a compound growth rate of nearly 40% over the next 3 years. At the same time, it will benefit from rich customers at home and abroad, and the market space will be further expanded.
Cleaning business: Based on cleaning systems, expanding overseas layout & ADAS automatic sensing cleaning system cleaning business scale is growing steadily. Gross profit restoration. Considering the competitive environment in overseas markets, the cleaning system business went overseas, and built separate auto parts production bases in the US (mainly assembly) and Thailand. China has introduced pilot guidelines for the entry and road launch of intelligent connected vehicles, with the intention of speeding up the implementation of L3 level intelligent driving. Intelligent driving sensor cleaning systems will become a new growth point. In order to maintain the safety of autonomous driving, cars above L3 level place higher demands on keeping cameras and lidars clean. We estimate that smart cleaning is expected to scale up in 25 with the implementation of L3 level autonomous driving regulations, and the space will expand as autonomous driving gradually develops and safety standards become more stringent. When the penetration rate of L2+ light vehicles reaches 40%, the global market size of intelligent cleaning will be 12.8 billion yuan. Currently, the company is actively developing ADAS cleaning capacity construction layout, and the intelligent driving assistance sensor cleaning system has been tested in small batches for some customers.
Thermal management business: Development of thermal management business
At present, the company has developed a layout in the field of thermal management, including the development of products such as “electronic circulation pumps, valves, and manifolds”. Among them, cooling manifold products are key components of automobile thermal management systems, and the business is growing rapidly.
Investment advice
With micromotors as the core technical capability, the cleaning business has developed on a large scale and forward-looking intelligent cleaning. The motor business has a multi-category layout, taking advantage of the wave of intelligence. We predict that the company will achieve operating income of 9.61/12.50/1,619 billion yuan in 2023-2025, with a year-on-year growth rate of 30.0%/30.2%/29.5%, and will achieve net profit to mother 2.02/2.68/354 million yuan, an increase of 38.7%/33.0%/31.80%, corresponding to 2023/2024/2025 P/E of 32.78/24.65/18.71x, respectively. The first coverage, optimistic about the company's core capabilities in micromotor manufacturing under the intelligent circuit, gave the company an “additional” rating.
Risk warning
(1) Automobile sales fell short of expectations; (2) the development of intelligent automobiles fell short of expectations; (3) the popularity of L3 intelligent driving fell short of expectations; (4) raw material costs rose; and (5) overseas factory construction progress fell short of expectations.