GOLDEN SUN SECURITIES·2026-01-27 12:24Investment Rating - The report maintains a "Buy" rating for Midea Group [5] Core Insights - Midea Group has successfully acquired KUKA, establishing a strong foothold in the industrial robotics sector, and is building an integrated automation industry system through self-research, international mergers, and ecological collaboration [1][12] - The industrial robotics market is highly concentrated, with the top five companies accounting for 42.8% of global revenue in 2023, and Midea ranks third with a market share of 8.9% [2][43] - Midea's robotics division is expected to see a significant increase in valuation as the market reassesses the value of its B-end business, with the overall P/E ratio currently lower than its peers [3] Summary by Sections 1. Robotics and Automation Business - Midea has completed a comprehensive acquisition of KUKA, securing a controlling stake and integrating its operations [1][12] - The acquisition process involved multiple stages, culminating in Midea holding 100% of KUKA's shares by 2022, with a total payment of approximately €3.7 billion [12][13] - KUKA's product structure includes industrial robots, mobile platforms, welding equipment, and system integration, catering to various industries such as electric vehicles and healthcare [1][21] 2. Industrial Robotics Industry - The industrial robotics industry is characterized by long-chain cooperation, with significant technological barriers in upstream components like controllers and servo systems, which account for about 70% of the total cost [2][33] - The market is projected to grow from ¥1,102 billion in 2017 to ¥1,421 billion in 2023, with a CAGR of 7.9% expected until 2027 [38] - Midea's market share in heavy-duty industrial robots is particularly strong, ranking second globally in both sales and revenue [43] 3. Competitive Landscape - The competitive landscape is dominated by the "Four Families" of industrial robots: ABB, FANUC, Yaskawa, and KUKA, which hold significant market shares and technological advantages [2][43] - Midea's robotics division is positioned to enhance its market share and stability by focusing on R&D and expanding its customer base in China [3][43] - The report highlights the need for Midea to improve its valuation in the robotics sector, as its current P/E ratio is significantly lower than that of its competitors [3]