Investment Rating - The report does not explicitly state an investment rating for the smart driving industry Core Insights - The smart driving industry is experiencing rapid evolution driven by "end-to-end" and "smart driving equity" concepts, with significant growth in both new energy vehicle sales and smart driving functionalities [3][4][9] - The penetration rate of L2-level smart driving in new energy vehicles in China has increased from approximately 7% in 2019 to around 65% by the first half of 2025, indicating a strong correlation between new energy vehicle sales and the adoption of smart driving technologies [9][10] - The smart driving market is projected to exceed 5 trillion yuan by 2030, with a compound annual growth rate driven by technological advancements and increased consumer acceptance [15][16] Summary by Sections 1. "Equity + End-to-End" Accelerating Smart Driving Evolution - The smart driving industry has seen a significant increase in new energy vehicle sales, which has created a positive feedback loop for the adoption of smart driving technologies [9][10] - The penetration of L2-level smart driving features in new energy vehicles has rapidly increased, reflecting the growing consumer acceptance and market expansion of smart driving technologies [9][10] 2. End-to-End Smart Driving Review - The evolution of end-to-end smart driving can be categorized into four main stages, with advancements in perception, decision-making, and control processes [30][32] - The introduction of the "occupancy network" has enhanced environmental perception capabilities, allowing for more accurate and stable decision-making in complex driving scenarios [46][47] 3. VLA Technology Route - The VLA (Vision-Language-Action) model is emerging as a key driver of paradigm shifts in autonomous driving, integrating visual, linguistic, and action modalities into a cohesive framework [70][71] - The VLA model's development is divided into four stages, with significant advancements in task understanding and execution capabilities [76][77] 4. World Model Technology Route - The world model approach emphasizes physical reasoning and spatial understanding, representing a long-term evolution path for smart driving technologies [69][70] - The integration of world models with cloud computing is expected to enhance the iterative optimization of end-to-end smart driving systems [65][66]

Core Insights - HeSai Technology and Guanghe Tong have established a strategic partnership to jointly launch a multi-modal perception and control solution for robots, integrating LiDAR, dual-vision, and RTK technologies [1] Group 1: Partnership Details - The collaboration focuses on 3D LiDAR technology and AI visual algorithms [1] - The partnership aims to enhance capabilities in embodied intelligence, quadruped robotic dogs, and lawn-mowing robots [1] Group 2: Application and Impact - The solution is designed to assist robots in achieving precise positioning, environmental perception and obstacle avoidance, as well as path planning and navigation [1] - The solution has already been successfully implemented in a leading domestic embodied intelligence company [1]

Group 1 - Recent years have seen a trend of Chinese concept stocks returning to Hong Kong for listing, with companies like Hesai Technology, Tianjing Biotechnology, WeRide, and Pony.ai announcing their plans or progress for Hong Kong listings [1][2] - Pony.ai plans to issue up to 102.1 million shares and has a current market value exceeding $7 billion, while Tianjing Biotechnology aims for a dual listing in Hong Kong to enhance collaboration with global innovators and diversify its investor base [1][2] - WeRide has received approval from the China Securities Regulatory Commission for its Hong Kong listing, intending to issue up to 102.4 million shares, and is noted for holding autonomous driving licenses in seven countries [1] Group 2 - Hesai Technology became the first lidar company to achieve a dual primary listing on the Hong Kong Stock Exchange, raising approximately HKD 4.16 billion and reaching a market value of HKD 35.85 billion on its first day [2] - Since the reform of the Hong Kong listing system in 2018, over 30 Chinese concept stocks have returned to Hong Kong, including major players like Alibaba, JD.com, and Baidu, representing a significant portion of the internet sector [2] - There are three main methods for Chinese concept stocks to return to Hong Kong: privatization and re-listing, secondary listings, and dual listings, with 34 companies having returned since 2018 [2] Group 3 - The return of Chinese concept stocks to Hong Kong is seen as a strategic move amid U.S. regulatory and geopolitical uncertainties, providing companies with better funding opportunities and faster listing processes [3] - The industry focus of returning companies has primarily been on internet platforms and biotechnology, with expectations for future expansions into emerging sectors such as semiconductors, industrial software, and intelligent driving [3]

Core Insights - Nvidia has established itself as a dominant player in the GPU market, with significant growth expected in its automotive business, projected to reach nearly $11 billion by 2035 at a 20% CAGR [1] - Amazon's acquisition of Zoox aims to develop fully autonomous electric vehicles, leveraging its logistics network for urban ride-hailing services [2] - Alphabet's Waymo is recognized as a leader in the driverless vehicle sector, offering Level 4 robotaxi services and benefiting from substantial financial backing and technological expertise [3] Industry Overview - The driverless vehicle market is anticipated to experience explosive growth over the next two decades, potentially reaching trillions of dollars by 2030, driven by technological advancements and safety improvements [6] - Major traditional automakers and technology companies are heavily investing in driverless vehicle technology, indicating a robust competitive landscape [5] Key Companies - Mobileye Global is positioned as a critical partner in the development of robotaxis, providing Advanced Driver Assistance Systems (ADAS) and various driverless vehicle technologies [8] - Uber Technologies is launching a global robotaxi program in 2026, utilizing Lucid's vehicle architecture and Nuro's Level 4 autonomy system [9] - Hesai Group is a leader in lidar technology, essential for various applications in autonomous vehicles, and has secured design wins with multiple automakers [11] Emerging Technologies - QuantumScape focuses on developing solid-state lithium-metal batteries for electric vehicles, which are expected to play a crucial role in the future of driverless vehicles [12] Investment Considerations - The driverless vehicle industry is set for significant transformation, with multiple companies positioned to benefit as the market evolves [13]

Core Viewpoint - The laser radar industry is experiencing significant growth despite initial skepticism, with companies like Hesai Technology achieving over one million units in annual production, indicating a strong market demand for laser radar technology [6][82]. Group 1: Market Performance - Hesai Technology has become the first company globally to produce over one million laser radars annually, with expectations to triple last year's output of 500,000 units [6][7]. - Another notable company, Suteng Juchuang, reported a total shipment of 266,800 units in the first half of 2025, marking a year-on-year increase of 9.6% [9]. - The domestic shipment of vehicle-mounted laser radars in the first half of this year saw a substantial increase of 71% compared to 2024 [10]. Group 2: Price Reduction and Accessibility - The cost of laser radars has decreased significantly, with prices dropping over 90% from previous years, making them more accessible for various vehicle models [24][28]. - The price of laser radars has reached as low as 1,400 yuan for certain models, allowing for integration into vehicles priced around 100,000 yuan [26][27]. - The introduction of lower-priced models, such as the Aion RT at 165,800 yuan and the Leapmotor B10 at 129,800 yuan, has further lowered the entry barrier for consumers [19][20]. Group 3: Technological Advancements - The transition from mechanical to semi-solid-state laser radars has been a key factor in reducing costs and improving performance, with semi-solid-state models being more compact and reliable [45][54]. - The development of MEMS micro-mirrors has enabled domestic manufacturers to reduce reliance on foreign suppliers, contributing to the rapid advancement of laser radar technology [70][73]. - The industry is moving towards fully solid-state laser radars, which promise even lower noise levels and longer lifespans, although challenges remain in terms of range and precision [75][81]. Group 4: Industry Landscape - The global laser radar market has shifted dramatically in the past five years, with domestic companies like Huawei, Hesai Technology, and Suteng Juchuang rising to prominence as foreign competitors like Velodyne and Bosch have retreated [82][84]. - A complete and mature industrial chain for laser radar has been established in China, supporting large-scale production and significant cost reductions [86]. - Beyond passenger vehicles, laser radars are finding applications in emerging fields such as smart robotics and logistics, indicating a broadening market potential [87][88].

Core Viewpoint - The report from Daiwa predicts a compound annual growth rate of 78% for LiDAR shipments in the Chinese passenger car market from 2025 to 2027, driven by the introduction of L3 autonomous driving systems requiring 4 to 5 LiDAR units per vehicle and stricter safety regulations for smart vehicle systems [1] Industry Summary - The cost reduction of LiDAR technology allows for installation in lower-priced vehicles, particularly those priced between 200,000 to 300,000 RMB, with applications also beginning in vehicles priced at 150,000 RMB [1] - Major European and Japanese automakers are expected to accelerate the deployment of Advanced Driver Assistance Systems (ADAS) starting next year, increasing demand for LiDAR due to the mass production of L2 and L2+ systems and L3 testing [1] Company Summary - The report initiates coverage on Hesai (HSAI.US) with a "Buy" rating, setting a target price of 264 HKD for its H-shares and raising the target price for its US shares to 34 USD [1]

Core Insights - The rapid growth in the installation of LiDAR systems is transitioning them from optional features to essential components in automotive safety systems [1][3] - The demand for advanced driving assistance systems (ADAS) is driving the development of higher-level autonomous driving technologies, particularly L2++ and L3 levels [1][6] - The industry is shifting its competitive focus from hardware configuration to core competencies in chip self-research and system integration [1][3] Market Trends - The installation of LiDAR in China is projected to exceed 1.5 million units in 2024, representing a year-on-year growth of 179.7%, with expectations to reach 2.5 million units by the end of 2025 [1][2] - The penetration rate of L2 and above ADAS in passenger vehicles is expected to reach 55.7% in 2024, potentially approaching 65% by 2025 [2] Technological Developments - The cost of LiDAR systems has significantly decreased, with prices dropping from approximately $80,000 to $200 over the past decade, largely due to advancements in chip technology [2][7] - The transition to self-developed chips has led to reduced costs and improved performance, enabling mass production and wider application in lower-priced vehicles [2][4] Industry Standards and Certification - The reliability of LiDAR systems is becoming a baseline requirement for industry entry, necessitating compliance with stringent automotive safety certification standards [3][4] - Major companies are actively pursuing automotive-grade certifications for their products, with recent successes in achieving AEC-Q and ISO 26262 certifications [3][4] Future Projections - The market value of LiDAR is expected to grow from $1.181 billion in 2024 to $5.352 billion by 2029, with a compound annual growth rate of 35% driven by the demand for L3 and higher-level autonomous driving [8]

Group 1 - Ctrip (TCOM.US) increased by 0.96% after announcing a long-term strategic partnership with Live Nation Asia to integrate travel and live music experiences in key Asian markets [2] - Toyota (TM.US) rose by 1.44% as it plans to launch its first mass-produced solid-state battery vehicle by 2027, aiming for advancements in range, charging speed, and performance [3] - New Energy (02688) surged over 2% due to a reasonable privatization plan, with institutions indicating potential progress in Q4 [3] - JD Health (06618) increased over 2% as Morgan Stanley noted the company's steady performance in Q3, providing upward potential for its FY25 targets [3] - XPeng Motors (09868) rose over 1% after signing an order agreement for 600 flying cars in the Middle East [3] Group 2 - Gao Xin Technology (03800) increased over 4% after announcing the completion of issuing 1.015 billion shares based on subscription and placement agreements [3] - InnoCare (02577) surged over 7% after announcing a collaboration with NVIDIA to provide a full GaN power solution for 800 VDC power architectures [3] - Hesai (HSAI.US) rose by 6.71% after announcing the production of its 1 millionth lidar unit by the end of September 2023, becoming the first company to achieve this milestone [3] - Baidu (BIDU.US) increased by 3.31% as Macquarie upgraded its investment rating from "Neutral" to "Outperform" due to Baidu's shift towards diversified revenue sources [3] - Tesla (TSLA.US) rose by 5.42% as it reportedly delivered over 240,000 vehicles in Q3 [3]

Investment Rating - The automotive industry is rated as "Leading" with expectations for strong performance in the upcoming quarter [1]. Core Insights - In September, the penetration rate of new energy vehicles (NEVs) reached 57.8%, indicating a positive outlook for sales in the fourth quarter [1][3]. - The retail sales of passenger vehicles in September reached 2.241 million units, marking a year-on-year increase of 9.2% for the first nine months of 2025 [3]. - The report highlights that domestic brands outperformed the industry, capturing a retail market share of 66.9% in September [3]. Summary by Sections Industry Performance - The retail sales of new energy passenger vehicles in September were 1.296 million units, with a penetration rate of 57.8%, up 5.0 percentage points year-on-year [3]. - The export of passenger vehicles totaled 528,000 units in September, with a significant increase in NEV exports [3]. Company Valuation Overview - Companies such as CATL, BYD, and Xpeng Motors are rated as "Buy" with target prices indicating potential upside [2][11]. - The average price-to-earnings ratio for the covered companies is projected to be 30.9 for FY25E [2]. Investment Recommendations - The report suggests focusing on companies like Xpeng Motors and Geely for their upcoming product launches and internal resource integration [3]. - It is advised to remain cautious as the market may enter a consumption lull after the fourth quarter sales surge [3].

Core Viewpoint - The humanoid robot industry is projected to become a trillion-dollar market, with significant growth expected in China by 2025, marking the beginning of a new era for humanoid robots [2][3]. Market Size Forecast - By 2045, the humanoid robot market in China is expected to reach 10 trillion RMB, while global annual revenue for humanoid robots could exceed 5 trillion USD by 2050 [3]. - NVIDIA's CEO highlighted that the AI-enhanced robot industry represents a new 10 trillion USD market opportunity [3]. Technological and Industrial Maturity - The current state of the robot industry is likened to the prelude of the smartphone and electric vehicle revolutions, with advancements in AI and robotics driving automation and intelligence [4]. - Key components of robots are becoming increasingly localized and modular, significantly reducing costs while scaling production [4]. Leading Enterprises and Innovation - Prominent companies like Yushun, Zhiyuan, and UBTECH are emerging, fostering a vibrant ecosystem of innovation that accelerates the transition from technological innovation to industrial growth [4]. - Component manufacturers are experiencing increased production volumes due to rising demand [4]. Synergy with Intelligent Connected Vehicles - The automotive industry, particularly in intelligent connected vehicles, shares numerous synergies with the humanoid robot sector, enhancing hardware, software, and application scenarios [5]. - Similarities in foundational hardware between autonomous vehicles and humanoid robots facilitate mutual empowerment in technology [6]. Software and Supply Chain Collaboration - Algorithms used in humanoid robots and autonomous vehicles show significant overlap, particularly in path planning and motion control [6]. - Over 50% of supply chain resources are shared between the automotive and humanoid robot industries, especially in sensors and chips [7]. Cost Reduction and Production Efficiency - The adoption of high-quality, low-cost components from the automotive sector is expected to significantly lower production costs for humanoid robots [7]. - The automotive industry's advanced automated production methods can enhance the efficiency and consistency of humanoid robot manufacturing [7]. Sales Channels and After-Sales Service - The automotive sales and service networks can effectively support the distribution and maintenance of humanoid robots, addressing reliability concerns [9]. - The transition from B2B to B2C and B2H sales models for humanoid robots is anticipated, with automotive dealerships potentially playing a key role [9]. Integration into Automotive Production - Humanoid robots are already being integrated into automotive production lines, performing various tasks and enhancing efficiency [10][11]. - Companies like Tesla are leading the way in applying humanoid robots in manufacturing, achieving significant improvements in speed and accuracy [11]. Future Applications and Scenarios - Humanoid robots are expected to extend their roles beyond manufacturing to include tasks such as driving assistance and logistics in challenging environments [12].