Core Insights - EHang Holdings Limited reported preliminary revenues for Q4 and fiscal year 2024, exceeding previous guidance and reflecting strong market demand for its products [1][2][3] Financial Performance - Q4 2024 revenues are expected to reach RMB162 million, a 20% increase from the guidance of RMB135 million, and a year-over-year increase of 187% from RMB56.6 million in Q4 2023 [2] - Total revenues for fiscal year 2024 are projected to be RMB454 million, representing a 6% increase from the guidance of RMB427 million, and a year-over-year increase of 287% from RMB117.4 million in 2023 [2] Market Demand and Product Performance - The revenue growth is attributed to stronger-than-expected market demand for EHang's flagship EH216-S pilotless passenger-carrying aerial vehicles, along with key operational milestones and growing business momentum [3]

Core Viewpoint - EHang Holdings Limited has announced a strategic partnership with China Communications Information & Technology Group Co., Ltd. to advance the low-altitude economy and urban air mobility ecosystem in China [1][2]. Group 1: Strategic Partnership Overview - The partnership aims to co-develop digital UAM infrastructure and transportation hubs, innovate UAV services, and establish a commercial operation model for the low-altitude economy [2][5]. - CCIT will leverage its expertise in digitalization and big data services to support EHang in creating a comprehensive technical solution for unmanned aerial vehicles [2][4]. Group 2: Infrastructure Development - EHang and CCIT will collaborate on the research, development, planning, and construction of digital UAM infrastructure, integrating technologies such as 5G, 6G, and satellite communications [3][10]. - The partnership will promote the establishment of flight data centers and dedicated communication networks, with EHang providing operational services [4][7]. Group 3: Targeted Initiatives - The collaboration aims to develop 100 intra-city and inter-city air traffic terminals and 100 low-altitude tourism terminals in National 5A Scenic Areas over the next three years starting in 2025 [9]. - EHang and CCIT will work together to create a low-altitude air mobility service system and expand the aircraft sales and leasing market [9][10]. Group 4: Innovation and Ecosystem Development - Both companies plan to establish a dedicated fund, research institute, and vocational training academy to support the low-altitude economy [10]. - The partnership will focus on incubating enterprises and cultivating talent to drive sustainable growth within the low-altitude economy [10][11].

Company Overview - CCIT is a specialized subsidiary of China Communications Construction Group (CCCG), focusing on digital transformation and strategic emerging industries [1] - CCIT is a national high-tech enterprise and key technical support unit for major projects under the Ministry of Transport [1] - CCIT is the only construction sector central state-owned enterprise with a "Beidou Operation Qualification" [1] - CCCG is a leading global comprehensive service provider for extra-large infrastructure, with a history of over a century [2] - CCCG is the world's largest port design and construction company, road and bridge design and construction company, dredging company, and container crane manufacturing company [2] - CCCG is also the largest international engineering contracting company in Asia and the largest highway investor in China [2] Strategic Partnership - EHang and CCIT announced a comprehensive strategic partnership in the fields of low-altitude economy and advanced air mobility ecosystem [13] - The partnership aims to co-develop digital UAM infrastructure and transportation hubs, innovate UAV services, and establish a commercial operation model for the low-altitude economy [14] - Both parties will collaborate on advancing the research and development, planning, and construction of digital UAM infrastructure [19] Low-Altitude Economy Initiatives - CCIT plans to introduce a comprehensive one-stop solution for low-altitude super IP projects integrating "land + space + content" [5] - The partnership aims to develop 100 intra-city and inter-city comprehensive air traffic terminals and 100 low-altitude tourism terminals in National 5A Scenic Areas over the next three years [6] - Both parties will establish city-level low-altitude air mobility service systems (E-Port terminals) and jointly operate a fully integrated low-altitude economic demonstration zone [6] - The collaboration will advance the rapid deployment and operation of low-altitude economy initiatives in major cities, coastal regions, and major economic zones across China [4] Innovation and Development - Both parties will explore the establishment of a dedicated fund, a research institute, and a vocational training academy for the low-altitude economy industry [8] - They plan to set up and operate innovation service hubs in major cities across China, incubating upstream and downstream enterprises while cultivating a skilled talent pool [8] - The partnership will incorporate digital technologies such as 5G, 6G, satellite communications, sensing, and high-precision navigation into the low-altitude aviation industry [19] Industry Leadership - EHang is the world's leading urban air mobility (UAM) technology platform company, providing UAV systems and solutions for air mobility, smart city management, and aerial media [10][11] - EHang's flagship product EH216-S has obtained the world's first type certificate, production certificate, and standard airworthiness certificate for pilotless eVTOL issued by the Civil Aviation Administration of China [11] - CCIT has constructed a comprehensive technical total solution and a systematic commercial service process for UAV big data services [14]

Core Viewpoint - EHang has signed a project cooperation agreement with the Weihai High-Tech Zone to establish a pilotless passenger-carrying eVTOL research and manufacturing base, aiming to promote the low-altitude economy in Shandong Province and enhance urban air mobility services [4][12]. Group 1: Agreement and Collaboration - EHang and Weihai High-Tech Zone have signed a purchase agreement for the first batch of 30 units of EH216-S pilotless passenger eVTOLs, with full payment completed [4]. - The collaboration will focus on establishing a manufacturing base for eVTOLs in Shandong and developing a low-altitude economy industrial park [5]. - The initiative aims to integrate low-altitude economy with cultural tourism and other regional industries, fostering the development of the low-altitude economy in the Weihai High-Tech Zone [5][6]. Group 2: Commercial Operations and Services - EHang and Weihai High-Tech Zone plan to create low-altitude tourism services that combine scenic sightseeing with technological experiences, launching comprehensive flight routes in the region [6]. - Key tourist sites for low-altitude sightseeing services include Weihai International Beach and Xiaoshi Island, with EHang assisting in personnel training and infrastructure planning [7]. - The cooperation aims to facilitate the commercial operations of EH216-S in Weihai, supported by favorable government policies and infrastructure development [8][10]. Group 3: Economic Development Goals - Shandong Province's Three-Year Action Plan for High-Quality Development of the Low-Altitude Economy aims to establish 400 digital low-altitude aircraft takeoff-and-landing platforms and launch over 50 intra-city UAV flight routes by 2027 [9]. - The plan targets a low-altitude economy scale of RMB100 billion by 2027, with EHang's collaboration expected to drive high-quality development in this sector [9]. - The Weihai High-Tech Zone is committed to accelerating the development of innovative industries, including the low-altitude economy, to achieve sustained economic growth [10].

Industry Development - The low-altitude economy is identified as a new powerful engine leading the high-quality development of China's economy, with a focus on enhancing aviation emergency rescue capabilities [4] - The Action Plan for the Development of Key Areas in Safety Emergency Equipment (2023-2025) aims to achieve an industrial scale of over RMB1 trillion in key areas of safety emergency equipment by 2025 in China [3] - Beijing Fangshan District has made notable strides in developing the low-altitude safety emergency industry, with goals to establish a manufacturing-oriented low-altitude safety emergency industrial park and achieve large-scale applications of new types of low-altitude equipment by 2027 [5] Company Strategy - EHang reached a strategic partnership agreement with Fangshan District Government to advance the low-altitude emergency rescue sector by establishing its national headquarters for low-altitude emergency rescue equipment in Fangshan District [1][9] - EHang plans to gradually establish regional emergency rescue centers across the country, starting from Fangshan District, to enhance the safeguarding of lives and property while advancing the low-altitude economy industry [6] - EHang showcased its comprehensive low-altitude firefighting emergency solutions, demonstrating its outstanding advantages of quick response, unmanned operation, and remote fleet management [21] Product and Technology - EHang's EH216-F, a pilotless electric vertical take-off and landing aircraft, offers precise directional firefighting competencies and has completed comprehensive technical tests by the China National Fire-Fighting Equipment Quality Supervision Testing Center [11] - EHang's flagship product EH216-S has obtained the world’s first type certificate, production certificate, and standard airworthiness certificate for pilotless eVTOL issued by the Civil Aviation Administration of China [6] - EHang and Fangshan District Government will collaborate to develop a range of low-altitude emergency mission scenarios, including urban firefighting, forest fire extinguishing, industrial emergency rescue, disaster relief, and inspection [13] Collaboration and Infrastructure - EHang and Fangshan District Government will collaborate to establish a comprehensive Emergency Firefighting Industrial Park in Fangshan District, integrating functions such as R&D, testing, manufacturing, sales, maintenance, and training [22] - The Fangshan District Government will actively coordinate industrial funds to support EHang's initiative and related projects [10] - A talent training center is planned to be established to cultivate operation and maintenance staff for diverse emergency and rescue missions with different aircraft [13] Industry Ecosystem - Fangshan District has formed an aviation emergency rescue industry ecosystem that integrates product research and development, manufacturing, technical services, and support services [15] - The district will continue to leverage its own resource endowment to provide comprehensive and full-chain service guarantees for low-altitude safety emergency enterprises [15] - EHang aims to create a high-quality demonstration for the national low-altitude emergency management system, leveraging Capital Beijing’s influence [6]

Core Viewpoint - EHang Holdings Limited has signed a strategic cooperation agreement with Chongqing Changan Automobile Co., Ltd. to collaborate on the development of flying car technologies, including electric vertical takeoff and landing (eVTOL) aircraft, aiming to enhance the urban air mobility (UAM) sector and explore a joint venture for future mobility ecosystem technologies [1][6][18]. Group 1: Strategic Partnership - The partnership will leverage EHang's expertise in aerial vehicles and low-altitude flight management, combined with Changan's manufacturing capabilities and market resources [1][6]. - Changan Automobile plans to invest over 20 billion yuan in the low-altitude economy sector over the next five years and more than 100 billion yuan over the next decade to develop integrated mobility solutions [4][16]. - The collaboration aims to accelerate the commercialization of flying cars and enhance EHang's eVTOL product line, targeting a broad consumer base [1][6][18]. Group 2: Market Potential and Development - The low-altitude economy in China exceeded 500 billion yuan in 2023 and is projected to reach 2 trillion yuan by 2030, with potential growth to 3.5 trillion yuan by 2035 [16]. - The Chongqing Municipal Government's Action Plan supports the development of the low-altitude economy and encourages intelligent automobile manufacturers to explore eVTOL R&D and production [7][16]. - The partnership aligns with Chongqing's strategy to become an innovative benchmark city in the low-altitude economy, addressing the challenges of its complex mountainous terrain [7][16]. Group 3: Technological Advancements - EHang is recognized as a pioneer in the UAM sector, focusing on R&D, design, mass production, and safe operation of pilotless passenger-carrying eVTOL aircraft [6][18]. - The collaboration will cover various aspects including R&D, production, market promotion, user experience, and after-sales service, integrating low-altitude economy applications [6][18]. - The EH216-S pilotless eVTOL performed a flight demonstration at the signing ceremony, showcasing the technological advancements in the sector [2][5].

Investment Rating - The investment rating for the company is "Buy" with a maintained rating for the next six months [1]. Core Insights - The company reported a significant revenue increase of 348% year-on-year for Q3 2024, reaching 128 million yuan, exceeding previous guidance. The net loss narrowed by 28.3% to 48.1 million yuan, with adjusted net profit at 15.7 million yuan, marking a sequential growth of 1,262% [1]. - The company has achieved positive operating cash flow for four consecutive quarters and secured strategic investments totaling over 22 million USD in November, enhancing its financial position [1]. - The flagship EH216-S series saw a delivery of 63 units, achieving record quarterly deliveries, with ongoing progress in eVTOL sales and operations across multiple cities in China [1]. - The company is expanding its international business and advancing airworthiness certification in countries like Brazil, Thailand, Japan, and the UAE [1]. - The company aims to achieve solid-state battery certification and mass production by the end of 2025, significantly enhancing the flight duration of its eVTOL products [1]. - Revenue guidance for Q4 2024 is projected at 135 million yuan, a year-on-year increase of 138.5%, with an annual revenue forecast of 427 million yuan, representing a growth of 263.5% [1]. - The company expects continued strong performance driven by increased demand from domestic and international customers, including government and tourism operators [1]. Summary by Sections Financial Performance - Q3 2024 revenue reached 128 million yuan, up 348% year-on-year, with a net loss of 48.1 million yuan, a reduction of 28.3% [1]. - Adjusted net profit for the quarter was 15.7 million yuan, reflecting a sequential increase of 1,262% [1]. - The company has achieved positive operating cash flow for four consecutive quarters [1]. Product Delivery and Operations - The EH216-S series delivered 63 units in Q3 2024, marking a significant increase in deliveries [1]. - The company is actively developing UAM demonstration projects in various cities, including Hefei, Guangzhou, and Shenzhen [1]. International Expansion - The company is expanding its international operations and has received flight permits in Brazil and Thailand, with ongoing certification efforts [1]. Technological Advancements - The company has made breakthroughs in solid-state battery technology, aiming for certification and mass production by the end of 2025 [1]. Future Guidance - Projected revenue for Q4 2024 is 135 million yuan, with an annual forecast of 427 million yuan for 2024 [1]. - The company anticipates continued growth driven by strong order backlogs and increasing production capacity [1].

Investment Rating - The report assigns a "Buy" rating to the company with a target price of $21.66 per share, compared to the current price of $14.06 [4]. Core Insights - The company is the world's first eVTOL enterprise to obtain all three necessary certifications (TC, AC, PC), leading the commercialization process in the industry. The EH216 series and VT series form the core product matrix, providing solutions for various applications such as urban air mobility and aerial media [2][39]. - The low-altitude economy is set to take off, with eVTOL expected to become a primary aircraft in this sector. The domestic eVTOL market is projected to reach a scale of 379.5 billion yuan by 2030 [2]. - The company holds significant first-mover advantages due to its certifications and superior product resources. It has a substantial backlog of domestic and international orders, supported by strong initial production capacity [2]. - Revenue forecasts for 2024-2026 are 434 million, 815 million, and 1.217 billion yuan, respectively, with net profits expected to narrow from losses to a profit of 80 million yuan by 2026 [2]. Summary by Sections Company Overview - The company has established itself as a leader in the urban air mobility sector, having been founded in 2014 and achieving significant milestones, including the launch of the world's first passenger-grade autonomous flying vehicle in 2016 and its listing on NASDAQ in 2019 [39][43]. Low Altitude Economy - The low-altitude economy is gaining traction, with government support and clear airspace divisions facilitating the development of various applications, including logistics, tourism, and emergency services [104][105]. Financial Performance - The company experienced a revenue increase of 165% in 2023, returning to a growth trajectory after a downturn during the pandemic. The net loss has been narrowing, indicating improving financial health [82][86]. Product and Market Position - The company has a diverse product lineup covering various scenarios, including passenger transport, logistics, and emergency response. The EH216 series and VT-30 are pivotal in capturing market share in urban air mobility [65][86].

Investment Rating - The report maintains a "Buy" rating for EHang with a target price of $17, corresponding to 30x 2026e P/E [4] Core Views - EHang's Q3 revenue of RMB 128 million met expectations, while profitability exceeded expectations with a non-GAAP net profit of RMB 15.74 million [2] - The company delivered a record 63 EH216-S units in Q3, up 14 units QoQ, including 40 to Xishan Cultural Tourism, 5 to Shenzhen Boling, and 3 to Zhejiang Wencheng [2] - Q3 gross margin was 61.2%, down 1.2pct QoQ, while operating loss ratio narrowed to 43% due to economies of scale [2] - EHang expects Q4 revenue of RMB 135 million, representing 138.5% YoY growth, and maintains 2024-2025 capex guidance of $15-20 million [2] Product Development - EHang completed its first eVTOL solid-state battery flight test in November, achieving 48 minutes 10 seconds of flight time, a significant improvement from the previous 25 minutes [2] - The company aims to achieve solid-state battery certification and mass production for EH216-S by the end of 2025 through its partnership with Xinjie Energy [2] - EHang entered a long-term strategic cooperation with Inpower in November to jointly develop high-performance motors and motor controllers for its eVTOL products [2] Market Expansion - EHang is expected to obtain its first OC (Operating Certificate) by the end of 2024, enabling commercial operations in Hefei [2] - The company is assisting customers and partners in Guangzhou, Shenzhen, Wuxi, Wencheng, and Zhuhai with OC applications [2] - EHang has made progress in international markets, receiving a test flight certificate from Brazil's civil aviation authority in September and conducting flight tests with Thailand's civil aviation authority [2] - The company has completed over 56,000 safe flights of autonomous eVTOL aircraft in 18 countries across Asia, Europe, North America, and Latin America [2] Financial Projections - Revenue is expected to grow from RMB 422 million in 2024 to RMB 1.255 billion in 2026, with non-GAAP net profit turning positive at RMB 11 million in 2024 and reaching RMB 252 million in 2026 [2][13] - EH216-S deliveries are projected to increase from 202 units in 2024 to 624 units in 2026, with ASP remaining stable at around RMB 1.96 million [13][17] - Gross margin is expected to stabilize at around 60% from 2024 to 2026, with non-GAAP net profit margin improving from 3% in 2024 to 20% in 2026 [13][17]

Investment Rating - The report assigns an "Outperform" rating to the company [4][5]. Core Insights - The company achieved a revenue of 128 million yuan in Q3 2024, representing a year-on-year growth of 348%. For the first three quarters of 2024, total revenue reached 290 million yuan, up 379.9% year-on-year. The net profit for the same period was -183 million yuan, an improvement from -230 million yuan in the previous year [1][7]. - The growth in revenue is primarily attributed to the increased delivery of the EH216 series aircraft, with a total of 138 units delivered in the first three quarters of 2024, marking a 375.9% increase year-on-year [1][7]. - The company is making steady progress in obtaining its Operational Certificate (OC), with expectations to receive the first OC by the end of this year. The current backlog of orders for the EH216 series exceeds 1,500 units [1][19]. Summary by Sections Financial Performance - In Q3 2024, the company reported a total revenue of 128 million yuan, a 347.8% increase year-on-year and a 25.6% increase quarter-on-quarter. The net profit for Q3 was -48.06 million yuan, an improvement from -67.12 million yuan in the same quarter last year [1][7]. - The adjusted net profit (non-GAAP) for Q3 2024 was 15.7 million yuan, compared to a loss of 31.3 million yuan in Q3 2023 [1][7]. - The gross margin for Q3 2024 was 61.2%, with a net margin of -37.6%, showing significant improvements in both metrics compared to previous periods [14]. Order Backlog and Market Demand - The company has a robust order backlog, with over 1,100 new purchase orders and pre-orders received since obtaining the Airworthiness Certificate (AC) for the EH216 series [1][24]. - The report highlights various customer orders, including significant contracts from Zhejiang Xiangyuan Cultural Tourism and Wenzhou Wencheng Transportation Development Group, among others, indicating strong market demand for the EH216 series [24][28]. Strategic Developments - The company is collaborating with various partners to establish UAM (Urban Air Mobility) demonstration projects in multiple cities, including Hefei, Guangzhou, and Shenzhen, to promote the commercial operation of the EH216-S aircraft [29][34]. - A strategic partnership with the Civil Aviation Flight University of China has been established to develop training programs for UAV operators and maintenance personnel, supporting the growth of the low-altitude economy [33][34].