BIDU(09888) 光大证券·2024-07-12 00:01Investment Rating - The report maintains a "Buy" rating for Baidu Group-SW (9888.HK) with a target price of 165 HKD, compared to the current price of 95.05 HKD [3]. Core Insights - Apollo Go, Baidu's autonomous taxi service, is experiencing rapid growth in order volume, with over 500 million orders completed as of July 2024, indicating strong market interest and potential for regional profitability [2]. - The autonomous driving service is supported by favorable policies and is expected to achieve significant market growth, with projections estimating the market size for autonomous driving in China to reach 383.2 billion RMB by 2024 [2]. - Cost control measures are in place, with the sixth-generation autonomous vehicle achieving L4 level full autonomy and a 60% reduction in production costs, suggesting a pathway to profitability by the end of 2024 [2]. Summary by Sections Business Development - Apollo Go has expanded its service to over ten cities, achieving a cumulative ride count exceeding 600 million by April 2024, with a 25% year-on-year increase in ride requests in Q1 2024 [2]. - The service has begun 24/7 operations, enhancing vehicle utilization and expanding service coverage [2]. Market Outlook - The report highlights the supportive regulatory environment, including the release of the "Beijing Autonomous Driving Vehicle Regulations" in June 2024, which aims to facilitate the development of autonomous driving [2]. - International competition is intensifying, with Tesla planning to launch its Robotaxi service in August 2024, further validating the market potential for autonomous ride-hailing services [2]. Financial Projections - The report slightly adjusts the Non-GAAP net profit forecasts for 2024-2026 to 28.5 billion, 29.7 billion, and 31.4 billion RMB respectively, reflecting a minor decrease in expectations [2]. - The revenue forecast for 2024 is set at 138.4 billion RMB, with a growth rate of 2.85% [11].