According to the IT Finance APP, Zhongtai Securities released a research report stating that for the first time covering Nanfang Black Sesame Group's Asia Vets (02533), they were given a "shareholding" rating. Considering that the company's A1000 and other chips have achieved mass production and are cooperating with multiple designated car models, taking the lead advantage in intelligent driving, launching the first domestic cross-domain computing chip C1200, the outlook for the chip business is promising. Moreover, the company has self-developed IP cores, complete supporting tools, and an improved ecological system, possessing advantages in independence and wide adaptability. The company is currently in a high investment rapid growth period and can be given a certain valuation premium. The company is expected to have revenues of 0.569/1.027/1.824 billion yuan from 2024 to 2026.

Zhongtai Securities' main points are as follows:

Nanfang Black Sesame Group Asia Vets: Positioned as an intelligent driving chip supplier, with an outstanding R&D team creating strong product capabilities.

1) Company Positioning: Tier 2 chip supplier, providing automotive-grade computing SoC and SoC-based smart automobile solutions. 2) Product Structure: The company has two automotive-grade SoC series - the Huashan series and the Wudang series, exploring high computing power and cross-domain new opportunities. As of December 31, 2023, the total shipments of the flagship A1000 series SoC exceeded 152,000 units. 3) Equity Structure: Single-party cumulative controllable equity is 21.90%, and prospects for multi-party investment and cooperative business are promising. 4) Talent Structure: The founder and core management team have approximately 20 years of industry experience, possessing a semiconductor + automotive composite genotype, with R&D and sales centers established in multiple locations, and a strong core R&D team. 5) Financial Analysis: The company's revenue growth is rapid, but the growth rate of the gross margin is slowing down, affected by the SoC wafer cost and pricing strategy. Cost control has significantly improved, but due to the company being in a growth phase, it still needs to increase early-stage investments in R&D + sales channels, putting short-term pressure on the profit margin.

Industry: The division of labor in the industry chain is more cost-effective, and collaborative research and development are expected to become mainstream.

1) Space: The wave of automobile "intelligence" is rising, with technology costs decreasing, consumer acceptance increasing, and relevant policy support. The year of mass production of NOA function has arrived, and the ADAS SoC market is rapidly expanding, with installation rates and value on the rise. 2) Trends: Self-developed SoC opportunities and challenges coexist, facing three tests of capital investment, repurchase cycle, and profit model. The division of labor in the industry chain is more cost-effective, and collaborative research and development are expected to become mainstream. 3) Landscape: Overseas manufacturers lead the automotive SoC market, while local chip manufacturers are accelerating to catch up. Nanfang Black Sesame Group enters various computing SoCs in different price ranges and has a comprehensive layout.

Core Competencies: Technological foundation, ecological empowerment, customer expansion.

Technology: 1) The product system has continuity, continuous iterative upgrade Roadmap. High computing power SoCA2000 was designed in 2022 and is expected to be mass-produced in 2026; automotive-grade cross-domain computing SoCC1200 was designed in 2022 and is expected to be mass-produced in 2025. 2) Independent development of core IP, master initiative, the company is one of the few automatic driving SoC suppliers that have independently developed automotive-grade IP cores. 3) Master complete SoC design capabilities, with a large amount of independent intellectual property.

Ecology: Platform-oriented design and toolchain configuration will become important competitive strengths. Software ecology determines the value of chips and helps customers "use chips well." 1) Shanhai development toolchain, with openness and scalability, further shortening the algorithm and model development cycle, used for algorithm migration, quantification, and deployment; 2) Hanhai-ASDSP middleware is adjusted on demand to meet the increasingly complex flexible requirements of bottom-layer hardware + sensors and upper-layer application.

Customers: The company's main customers are automotive OEMs and Tier-1 suppliers, with a steadily growing number of customers. As of December 31, 2023, the customer base totaled 85. 1) Vehicle end: Models equipped with the company's chips gradually begin mass production after 2023, including mass-produced models such as Lynk 08, Hechuan V09, Dongfeng eπ007, and the first pure electric SUV. 2) Road end: It is one of the few domestic suppliers capable of delivering both vehicle-end and road-end perception and vehicle-road cooperative solutions simultaneously.

Risk Warning: Market demand falls short of expectations; Technological iteration and innovation; Market competition intensifies; There is a risk that the public data used in research reports may have information lag or be outdated.