Soochow Securities released a research report stating to maintain a "buy" rating on Sutekang Jun Chuang (02498). The company published its Q3 report for 2024, achieving revenue of 1.13 billion yuan in the first three quarters of 2024, up 91.5% year-on-year; net income attributable to the parent company rose 69.0% year-on-year. In Q3 2024, the company realized revenue of 0.41 billion yuan, up 54.7% year-on-year, and up 11.4% quarter-on-quarter; net income attributable to the parent company increased 77.4% year-on-year and 40.2% quarter-on-quarter. The company's performance exceeded market expectations.

The main viewpoints of soochow securities are as follows:

ADAS shipments continue to grow significantly, and gross margin improves quarterly.

In Q3 2024, the company's ADAS products achieved revenue of 0.33 billion yuan, up 87.1% year-on-year and up 8.7% quarter-on-quarter; shipments reached 0.131 million units, up 150% year-on-year and up 11% quarter-on-quarter. The increase in shipments was driven by several SOP models; in Q4 2024, more models like BYD Yangwang will gradually enter mass production, further boosting the company's shipment volume. According to Gaishi Automotive, the company's market share in the first three quarters of 2024 reached 35.0%, maintaining its position as the industry leader. Benefiting from the increase in shipments and a decrease in raw material procurement costs, the gross margin for the company's ADAS products rose from 10.6% in Q1 2024 to 14.1% in Q3 2024, with an overall gross margin of 17.5% in Q3 2024. The company also guided that the overall gross margin will continue to improve in Q4.

MX assists in the penetration of intelligent driving in mid to low-end models, and ADAS still has significant growth potential.

The company's MX products continue to expand influence with highly cost-effective product advantages, having already established partnerships with 7 OEMs in the L2+ field. As of November 2024, the company has achieved cooperation with 28 OEMs and tier-one suppliers, increasing the number of specific models to 92. In the L4 field, cooperation with the world's largest mobility platform and Pony.ai has been established for mass production, benefiting from the trend of transitioning from mechanical lidar to semi-solid solutions. The institution believes the company has preliminarily succeeded in executing strategies to reduce lidar costs for automotive manufacturers to accelerate volume production. Looking forward, the logic explained in the report published in mid-October on the company's Q1-Q3 shipment data is becoming increasingly clear—models such as BYD Han, Seal, Geely Galaxy E8, and GAC AION RT are equipped with lidar, highlighting the trend of intelligent driving demands penetrating into high-volume models. Meanwhile, the company has accumulated quality projects with leading overseas OEMs, building more momentum for development in 2026 and beyond.

The overseas customers of siasun robot&automation have exceeded expectations, and the mass production release is expected to replicate the growth trajectory of ADAS.

In Q3 2024, revenue from siasun robot&automation lidar reached 0.06 billion yuan, up 44.5% quarter-on-quarter; shipments were 0.007 million units, up 38% year-on-year and up 53% quarter-on-quarter. The company secured multiple key local and international clients in the robotics sector in Q3 2024, with the number of partners in the robotics field increasing from 2,400 to 2,600. Several new products have been designated for mass production by leading robotics companies and are expected to be delivered within 18 months; the company forecasts that shipments in the robotics field may exceed six figures by 2025. The firm believes that shipments from the company's robotics products are expected to contribute a significant increase in revenue and gross margin.