Key points of investment

Incident: The company released shipment data for the first nine months of 2024. 24Q1-Q3's total lidar shipments/ADAS lidar shipments/robots and other lidar shipments were 0.382/0.366/0.016 million units, respectively, corresponding to +364%/395%/129% YoY. 24Q3 shipped 0.1386 million lidar products, +140% year over month.

ADAS continues to grow rapidly and is full of momentum

24Q3 shipped 0.1314 million ADAS lidar units, +150% year over year and +11% month over month. Since this year, the company's various SOP models have gradually formed a high sales scale, driving a continuous year-on-year increase in ADAS product shipments.

We believe that the company has initially successfully implemented a strategy to reduce the cost of lidar from car manufacturers to accelerate emission. Looking back, assembly lidars such as the BYD “Dynasty” and “Ocean” series and Geely's “Galaxy” series have highlighted the trend of penetration from the demand side to large base models. The MX products launched by the company not only further reduce the cost threshold for lidar penetration, but are also expected to further increase the product gross profit margin by applying self-developed SoC and other measures. The subsequent growth of the company's ADAS products is still worth looking forward to.

The launch of robots is expected to become a new leader in contributing to performance

24Q3 shipped 0.0072 million robots and other lidar units, +38% year over year and +53% month over month. Demand for robots in various application scenarios was gradually released. According to company guidelines, the 24Q4 robot shipment volume is expected to approach the full year of last year (about 16,000 units) or the first three quarters of this year (about 16,100 units). If estimated with the expected Q4 shipment volume of 16,000 units, it is about +357% year over year and +122% month over month. We believe that shipments of the company's robot products are expected to contribute significantly to the company in terms of revenue and gross profit.

Profit forecast and investment rating: We maintain the company's 2024-2026 revenue forecast of 2.22/3.56/5.1 billion yuan, and net profit to mother of 0.53/-0.19/0.13 billion yuan. The closing price on October 10, 2024 corresponds to PS of 3.5/2.2/1.5 times, respectively, and maintains a “buy” rating.

Risk warning: Demand for new energy vehicles falls short of expectations, competition in the NEV market intensifies, lidar penetration rate falls short of expectations, and industry competition intensifies.