Core Viewpoint - Horizon has achieved significant revenue growth and market performance, but faces increasing operational and net losses, raising questions about its valuation and sustainability in the competitive autonomous driving market [1][2][9]. Group 1: Financial Performance - Horizon's revenue for the first half of 2025 reached 1.567 billion RMB, a year-on-year increase of 67.6%, while operational losses and net losses expanded to 1.592 billion RMB and 1.333 billion RMB, respectively [1][4]. - The company's automotive products and solutions revenue surged from 220 million RMB in the same period last year to 778 million RMB, marking a growth of over 250% [1]. Group 2: Market Position and Competition - The autonomous driving market is becoming increasingly competitive, with companies like NIO, Geely, and XPeng developing their own chips, which may threaten Horizon's position as a supplier [6][9]. - Horizon's reliance on major clients is growing, with the top five clients contributing 71.8% of its revenue in 2024, raising concerns about customer concentration risk [4]. Group 3: Strategic Partnerships - Horizon has formed strategic partnerships with several automakers, including GAC Capital, Chery, Great Wall, BYD, and FAW Group, to alleviate concerns about losing control over the "soul" of the vehicles [2][4]. - The establishment of joint ventures with companies like Volkswagen and Changan has allowed Horizon to integrate into the supply chains of these automakers [2]. Group 4: Product Strategy and Pricing - The shift towards lower-tier autonomous driving solutions has led to a decrease in average selling prices, impacting profit margins; for instance, the average price of the Horizon Mono solution dropped from 185 RMB in 2021 to 142 RMB in 2024 [12][15]. - The company's gross margin has declined from 80.5% in 2024 to 67.1% in the first half of 2025, primarily due to the lower margins associated with product solutions compared to its software business [14]. Group 5: R&D Investment and Future Outlook - Horizon's R&D expenses reached 2.3 billion RMB in the first half of 2025, a 62% increase year-on-year, as the company invests heavily to maintain its competitive edge in high-tier autonomous driving technology [17][22]. - The company is also exploring new markets, such as Robotaxi and robotics, but these ventures require substantial ongoing investment and carry significant uncertainty [22][23].

Core Viewpoint - The "2025 Phoenix Star Listed Company Awards" ceremony highlighted the performance of companies in various key areas, with Horizon Robotics winning the "Best IPO Company" award for its significant market achievements and innovations in the intelligent driving sector [1][2]. Group 1: Award Overview - The awards, supported by the China Listed Companies Association, included nine categories focusing on innovation, returns, responsibility, growth, brand influence, and globalization [1]. - The "Best IPO Company" award evaluated companies based on their performance before and after IPO, market value management, and compliance during the listing process [2]. Group 2: Horizon Robotics Achievements - Horizon Robotics successfully listed on the Hong Kong Stock Exchange in October 2024, with its market value increasing by over 200% within a year [4]. - The company has achieved significant breakthroughs in both hardware and software, with over 10 million units of its computing solutions shipped and the mass production of its urban auxiliary driving system [4]. - Horizon Robotics holds over 40% market share in China's OEM advanced auxiliary driving market and ranks second among independent high-level autonomous driving solution providers [6]. Group 3: Industry Impact - The successful IPO of Horizon Robotics has reignited market confidence in the technology innovation sector, positioning the company as a leader in the domestic intelligent driving chip industry [4]. - The company aims to expand its market presence and technological value over the next three to five years, focusing on the deployment of millions of units and the development of Robotaxi services [4][6]. - Horizon Robotics is recognized as a key player in reshaping the global competitive landscape of the intelligent driving industry, promoting a diversified and balanced market environment [6].

Group 1: AI Infrastructure and Cloud Computing - The demand for computing infrastructure is expected to continue expanding due to the explosion of AI model requirements and the intelligent transformation across various industries [2] - AI infrastructure serves as a hub connecting computing hardware and AI applications, driven by hardware upgrades and technological breakthroughs [2] - The value of cloud computing is anticipated to be reassessed in the context of AI penetration, leading to new growth opportunities [2] Group 2: Solid-State Battery Investment - Global solid-state battery shipments are projected to reach 614 GWh by 2030, with a compound annual growth rate (CAGR) exceeding 80% from 2024 to 2030 [3] - The solid-state battery market in China is expected to expand significantly, with a market size projected to reach 20 billion yuan by 2030 [3] - The solid-state battery sector is seen as a "0-1" industry trend, with potential for significant capital inflow if positive industry changes occur [3] Group 3: PCB Industry Growth - The PCB industry is entering a growth cycle driven by AI applications, with expectations for simultaneous increases in both volume and price [4] - Copper-clad laminates, which account for approximately 27% of PCB cost structure, are critical materials for PCB manufacturing [4] - High-frequency and high-speed copper-clad laminates are expected to see rapid demand growth due to applications in AI and 5G [4] Group 4: Computing Power Chain Investment - OpenAI and Meta are increasing investments in AI infrastructure, with OpenAI planning a data center in India using over 1 GW of power and Meta planning to invest $600 billion in U.S. data centers by 2028 [5] - The ongoing expansion of global computing power demand is likely to benefit leading optical module companies [5] Group 5: Domestic Intelligent Driving Chip Market - The development of the intelligent driving sector is becoming a core function in the automotive industry, with significant advancements expected by 2025 [6] - Domestic intelligent driving chip suppliers are poised for accelerated market share growth due to competitive pricing and production experience [6] - The trend of domestic substitution is expected to further enhance the market position of local chip manufacturers [6]

Core Viewpoint - The report from浦银国际 highlights the growing importance of intelligent driving chips in the automotive industry, particularly as the sector transitions into a new phase of development, with a focus on smart assisted driving as a core feature [1] Industry Summary - The intelligent driving chip industry is positioned as a high-value segment within the automotive supply chain, driven by advancements in smart driving technologies [1] - By 2025, Chinese automakers are expected to push for "intelligent driving equality," leading to a decrease in the price range of models equipped with high-speed NOA [1] - Leading new energy vehicle companies are advancing algorithm evolution based on end-to-end architecture, which will promote both volume and price increases for intelligent driving chips [1] Company Summary - The report initiates coverage on Horizon Robotics (09660) and Hezhima (000716), both receiving "Buy" ratings with target prices set at HKD 12 and HKD 21.4 respectively [1] - Local intelligent driving chip suppliers are expected to gain market share due to their cost-effective products and production experience, benefiting from the trend of domestic substitution [1] Market Data - According to Frost & Sullivan, the global automotive-grade SoC market reached RMB 57.9 billion in 2023 and is projected to grow to RMB 205.3 billion by 2028, with a compound annual growth rate (CAGR) of 29% [1] - In China, the automotive-grade SoC market size was RMB 26.7 billion in 2023, expected to increase to RMB 102 billion by 2028, capturing 50% of the global market share [1]

Core Viewpoint - The report from浦银国际 highlights the growing importance of intelligent driving chips in the automotive industry, particularly as the sector transitions into the second half of the new energy vehicle (NEV) development phase [1] Industry Summary - The intelligent driving chip industry is receiving an "overweight" rating, indicating strong growth potential as it becomes a core component of intelligent driving functions in vehicles [1] - The global automotive-grade SoC market is projected to grow from 57.9 billion RMB in 2023 to 205.3 billion RMB by 2028, with a compound annual growth rate (CAGR) of 29% [1] - China's automotive-grade SoC market is expected to increase from 26.7 billion RMB in 2023 to 102 billion RMB by 2028, capturing 50% of the global market share [1] Company Summary - The report initiates coverage on Horizon Robotics (09660) and Black Sesame Technologies (02533), both receiving "buy" ratings with target prices set at 12 HKD and 21.4 HKD respectively [1] - Domestic intelligent driving chip suppliers are anticipated to expand their market share rapidly, benefiting from competitive pricing and production experience, alongside the trend of domestic substitution [1] - The report emphasizes that both independent Chinese automakers and leading NEV companies are driving advancements in intelligent driving technology, which will enhance the demand for intelligent driving chips [1]

Core Viewpoint - The report from浦银国际 indicates that as the electric vehicle (EV) industry enters its second phase, intelligent assisted driving has become a core function of automotive intelligence, with smart driving chips emerging as a key component in the value chain [1] Industry Summary - The development of intelligent driving chips is expected to see a rise in both volume and price by 2025, driven by domestic automakers pushing for equal access to intelligent driving features and leading EV companies advancing algorithm evolution [1] - Local smart driving chip suppliers are gaining prominence, leveraging cost-effective chip products and production experience to expand their customer base, benefiting from the trend of domestic substitution [1] Company Summary - The report initiates coverage of the smart driving chip industry with an "overweight" rating and also covers companies Horizon Robotics and Black Sesame Technologies, assigning "buy" ratings with target prices of HKD 12 and HKD 21.4 respectively [1]

Investment Rating - The report gives an "Overweight" rating for the intelligent driving chip industry and a "Buy" rating for Horizon Robotics-W (9660.HK) and Black Sesame Intelligence (2533.HK) [3][7][9]. Core Insights - The intelligent driving chip market is expected to expand significantly, with the global ADAS SoC market projected to reach RMB 92.5 billion by 2028 [7]. - The penetration rate of ADAS functions in China's new energy passenger vehicles reached 82.6% in the first half of 2025, indicating a strong demand for intelligent driving capabilities [8][55]. - Domestic intelligent driving chip suppliers are gaining market share due to their cost-effective products and production experience, benefiting from the trend of domestic substitution [9]. Summary by Sections Industry Background - The automotive electronic architecture is evolving, with SoC becoming the mainstream choice for control chips in intelligent electric vehicles [13][14]. - The intelligent driving chip is a core component for achieving advanced driver-assistance systems (ADAS) and autonomous driving functions [19]. Current Industry Status - The intelligent driving process is still in its early stages, with high-level ADAS function penetration remaining low [39]. - The global electric vehicle market is expected to exceed 20 million units in 2025, with a penetration rate of over 25% [39]. Development Trends - The intelligent driving chip market is rapidly expanding, driven by the increasing complexity of software and hardware requirements for ADAS functions [7][19]. - The market for automotive-grade SoC is projected to grow from RMB 57.9 billion in 2023 to RMB 205.3 billion by 2028, with a compound annual growth rate of 29% [19]. Competitive Landscape - Domestic manufacturers are expected to capture a larger market share as they improve their production capabilities and experience [9]. - The competition in the intelligent driving chip market is intensifying, with various players entering the field [9]. Investment Value - The report is optimistic about the upgrade of ADAS capabilities and the domestic substitution trend, indicating potential long-term growth in the robotics sector [9][10]. - The intelligent driving chip market is expected to see a simultaneous increase in both volume and price due to advancements in algorithms and hardware requirements [9]. Company Coverage - Horizon Robotics-W (9660.HK) is positioned as a leading player in the domestic intelligent driving chip market, with a target price of HKD 12.0, representing a potential upside of 22% [11]. - Black Sesame Intelligence (2533.HK) is also highlighted as a key player, with a target price of HKD 21.4, indicating a potential upside of 16% [11].

Investment Rating - The report maintains a "Buy" rating for Mobileye (MBLY.US) with a target price adjusted to $18.1, indicating a potential upside of 17% [1][3]. Core Insights - Mobileye's 2Q25 performance exceeded expectations, with revenue reaching $506 million, a 15% year-over-year increase. The company has raised its full-year revenue guidance to a range of $1.765 to $1.885 billion [9][12]. - The company is optimistic about its growth trajectory, expecting a revenue inflection point in 2027, driven by advancements in autonomous driving technology and partnerships with major players like Volkswagen, Lyft, and Uber [9][12]. Financial Forecasts - Revenue projections for Mobileye from 2023 to 2027 are as follows: - 2023: $2,079 million - 2024: $1,654 million - 2025E: $1,851 million - 2026E: $1,948 million - 2027E: $2,650 million - The adjusted net profit is forecasted to grow from $659 million in 2023 to $540 million in 2027, with a notable increase of 56% in 2027 [2][10]. Performance Metrics - In 2Q25, Mobileye's total shipment volume reached 9.7 million units, a 28% increase year-over-year, with EyeQ chip shipments close to 9.65 million units [12]. - The adjusted gross margin for 2025 is projected at 68.5%, with an adjusted net profit margin of 15.6% [13][15]. Valuation - The report employs a DCF valuation method, estimating a WACC of 12.3% and a perpetual growth rate of 3%, leading to a target price of $18.1 per share [9][14].