Investment Rating - The report maintains a "Strong Outperform" rating for the computer industry [1] Core Viewpoints - The report highlights the rapid development of domestic automotive-grade SoC chips, driven by architectural innovation and ecological restructuring, creating significant opportunities for localization in the smart driving SoC market [3][17] - The domestic automotive-grade SoC market is projected to reach CNY 102 billion by 2028, with a compound annual growth rate (CAGR) of 42% from 2019 to 2023 [3][19] - The report emphasizes the shift towards centralized integrated vehicle architectures, with the "One Chip" solution being viewed as the ultimate form of integration for cockpit and driving functions [28] Summary by Sections Current Status - The report discusses how the transition from traditional MCU chips to SoC chips is essential for meeting the increasing demands for data processing and throughput in smart connected vehicles [3][6] - The automotive chip market is experiencing a significant increase in value, with the automotive-grade SoC market in China reaching CNY 267 billion in 2023, growing at a CAGR of 42% from 2019 to 2023 [19] Trends - The report notes that the proliferation of smart driving technologies is releasing domestic potential, with policies and market forces driving the rapid rise of domestic SoC manufacturers [3][22] - The report predicts that by 2028, the penetration rate of autonomous passenger vehicles in China will reach 93.5%, with a total sales volume of 27.2 million units [19] Landscape - The smart driving SoC market is characterized by three competitive camps: dedicated smart driving SoC suppliers, general-purpose chip suppliers, and automotive OEMs developing their own solutions [3][17] - Domestic manufacturers like Horizon Robotics and Black Sesame Intelligence are rapidly gaining market share, with Horizon holding a 33.97% share in the domestic automotive-grade smart driving chip market in 2024 [3][19] Investment Recommendations - The report suggests that the smart driving SoC industry is undergoing a historic development opportunity, with strong recommendations for companies like Zhongke Chuangda and recommendations for Desay SV, Horizon Robotics, and Huayang Group [3][19]