Industry Overview - The domestic intelligent driving chip industry is experiencing rapid growth, with the penetration rate of intelligent driving expected to drive significant market expansion in the short to medium term. The demand for robots is anticipated to create additional growth opportunities in the long term [1] - Most OEMs are likely to continue relying on third-party neutral intelligent driving chip platforms due to high costs associated with self-developed chips, including time, financial, and human resource investments, as well as high barriers in software ecosystems [1] Product Development - The company has a strong R&D capability in intelligent hardware, with core employees having over 15-20 years of experience. The A1000 series has been successfully mass-produced, enhancing the company's production experience [1] - The new mid-tier intelligent driving computing platform, C1200 family, aligns with the evolution of automotive EE architecture and cost reduction demands, showing considerable commercial potential. The next-generation high-performance platform, A2000, is set to cover various scenarios from NOA to Robotaxi, with mass production planned to start in 2026 [1] Ecosystem Collaboration - The company positions itself as a Tier 2 player, collaborating with leading Tier 1 manufacturers and algorithm firms to advance commercialization efforts [1] Growth Potential - The company is replicating its automotive-grade chip capabilities in the robotics industry, accelerating scale through external acquisitions and has launched the SesameX commercialization deployment platform [2] Financial Projections - Revenue forecasts for 2025, 2026, and 2027 are projected at 830 million, 1.38 billion, and 2.11 billion yuan respectively, with year-on-year growth rates of 75.8%, 65.5%, and 52.8% [2] - The company is assigned a reasonable valuation multiple of 12x PS for 2026, corresponding to a fair value of 28.46 HKD per share, maintaining a "buy" rating [2]

Core Viewpoint - The report from GF Securities highlights the growth potential of the domestic intelligent driving chip industry, emphasizing that only a few OEMs are likely to achieve self-research capabilities in the short to medium term due to high costs and barriers associated with self-developed chips [2] Group 1: Industry Overview - The intelligent driving chip market is expected to grow rapidly, driven by increased penetration rates and future demand from robotics [2] - Most OEMs are anticipated to continue sourcing from neutral third-party intelligent driving chip platforms due to the high costs and challenges of self-development [2] - Geopolitical changes are expected to further boost the market share of domestic manufacturers [2] Group 2: Product Development - Black Sesame's hardware R&D capabilities are strong, with core employees having over 15-20 years of experience, contributing to high team stability [3] - The A1000 series has allowed the company to refine its mass production experience, while the new C1200 family aligns with automotive EE architecture trends and cost reduction needs [3] - The upcoming A2000 platform is designed to meet various scenario demands from NOA to Robotaxi, with mass production planned to start in 2026 [3] Group 3: Ecosystem and Collaboration - The company positions itself as a Tier 2 player, collaborating with leading Tier 1 suppliers and algorithm vendors to advance commercialization [4] - By adhering to traditional automotive industry value boundaries, the company creates significant value for partners and ample differentiation space for OEMs [4] Group 4: Growth Potential - The company aims to replicate its automotive-grade chip capabilities in the robotics sector, accelerating scale through external acquisitions and has launched the SesameX commercialization deployment platform [5] Group 5: Financial Projections - Revenue forecasts for 2025, 2026, and 2027 are projected at 830 million, 1.38 billion, and 2.11 billion yuan, representing year-on-year growth rates of 75.8%, 65.5%, and 52.8% respectively [6] - A reasonable valuation multiple of 12x PS is assigned for 2026, corresponding to a target price of 28.46 HKD per share, maintaining a "buy" rating [6]

Group 1 - The Ministry of Industry and Information Technology has officially granted conditional approval for the first batch of L3-level autonomous driving vehicles, marking a significant step towards commercial application in China [1] - Two models, from Changan and Arcfox, will be tested in designated areas in Beijing and Chongqing, indicating a shift from technology validation to mass production application in the autonomous vehicle industry [1] - The approval reflects the government's support for innovation and the industry's readiness for a commercial rollout, with L3-level autonomous driving requiring collaboration across multiple sectors including hardware, software, and data services [1] Group 2 - The approval of L3 vehicles was anticipated, as the Ministry of Industry and Information Technology had previously emphasized the importance of advancing intelligent connected vehicle regulations [2] - Major cities are actively promoting L3 autonomous driving, with designated testing roads established in areas like Shanghai and Beijing, indicating a growing infrastructure for autonomous vehicles [2] - Industry experts predict that the demand for intelligent mobility will surge by 2025, driven by policy implementation, technological breakthroughs, and increased market demand [2] Group 3 - Horizon Robotics is a leading player in the advanced driver assistance systems market, providing both chips and algorithms, and has established a strong presence in the domestic market [3] - Black Sesame Intelligence has developed high-performance computing solutions for autonomous driving and has partnered with major automotive OEMs, enhancing its product offerings [4] - RoboSense has achieved significant market leadership in the global automotive lidar market, indicating strong competitive positioning in the autonomous driving technology sector [4] Group 4 - Youjia Innovation has successfully secured contracts in the intelligent driving sector and is investing in both mid-to-high level assistance and L4 autonomous driving solutions, showcasing its growth potential [5]

Summary of Black Sesame Management Meeting Company and Industry - **Company**: Black Sesame (2533.HK) - **Industry**: Semiconductor and Smart Driving Technology Key Points Smart Driving Growth - Management is optimistic about the smart driving trend in China, particularly for 2026, driven by the adoption of highway NOA (Navigation on Autopilot) and city NOA, which will enhance product mix and average selling price (ASP) [1][2][3] Chipset Development - The latest chipset, A2000, is set for mass production by the end of 2026, featuring 567 TOPS computing power, which is competitive against NVIDIA's Thor U at 700 TOPS and Horizon Robotics' G6P at 560 TOPS [2] - A2000 utilizes ASIC architecture for better computing power utilization compared to GPGPU, providing flexibility for car OEMs to develop their own algorithms or use third-party software [2] Revenue Outlook for 2026 - Management anticipates revenue growth in 2026 despite competitive market conditions, supported by: - An increase in highway NOA penetration from 15-20% in 2024 to 35% by the end of 2025, with further growth expected in 2026 - City NOA penetration expected to rise from 5% in 2024 to 15% currently, with additional upside in 2026 - Supportive government policies encouraging the adoption of local chipsets by car OEMs [3] Robotics as a Long-Term Growth Driver - Black Sesame is expanding into robotics, targeting various market segments: - Below 50 TOPS for mobility in robots - 50-100 TOPS for precision control in industrial robots - Up to 500 TOPS for humanoid robots' central computing [4][7] - The company has received orders for industrial robots, indicating strong demand in this sector [7] Competitive Positioning - The in-house NPU IP and toolchain are highlighted as key factors securing Black Sesame's market position in smart driving technology [2] Government Support - The management emphasizes the role of government policies in fostering the growth of local chipset adoption among car OEMs, which is expected to further drive demand for Black Sesame's products [3] Additional Insights - The management's positive outlook aligns with broader trends in the smart driving and robotics sectors, suggesting potential investment opportunities in these areas [1][3][4]

Summary of Conference Call on Robotics Domain Controller Industry Trends Industry Overview - The conference discusses the robotics domain controller industry, highlighting the transition of automotive intelligent driving domain control solutions to robotics platforms, aiming to create an efficient, safe, and open robotics controller, referred to as the "brain" platform [1][2] - Rapid advancements in artificial intelligence, particularly large language models (LLMs), are driving the growth of the robotics industry, similar to the developments seen in the autonomous driving sector a decade ago [1] Key Insights and Arguments - The acquisition of an integrated joint company by the company lays the foundation for testing and exploring new directions in robotics [1][2] - The introduction of high-performance chips like NVIDIA's Orin chip is being adopted by domestic companies such as Desay SV and Joyson Electronics, indicating strong market recognition and expectations for NVIDIA's technological solutions [1][5] - Domestic intelligent driving chip systems, including Horizon Robotics and Huawei, are reshaping the edge chip market landscape, suggesting that the robotics sector is becoming a new ecological soil for competition [1][6] - Horizon Robotics has shown promising performance in edge testing, with significant computational output efficiency, indicating substantial future potential [7] - The current market for robotics domain controllers is expected to be competitive, with multiple companies driving industry development rather than being dominated by a few players [6][10] Future Business Models and Competitive Landscape - The future business model and competitive landscape for robotics domain controllers are still uncertain, with significant differences from the automotive industry, which has a long history [4] - The rapid iteration of AI technology is expected to influence the robotics industry, but whether the controller segment will mirror the automotive sector remains to be seen [4] - Companies are encouraged to be pioneers in the industry to secure strategic advantages, as the fast pace of AI development necessitates adaptability to avoid obsolescence [4] Technological Developments - The demand for high-performance platforms is increasing due to advancements in technologies like Google DeepMind's Gemini 5.0, which showcases complex brain functions based on natural language processing [3][8] - The robotics domain controller's complexity is heightened by the lack of complete standardization, with ongoing changes in hardware and parameters [9] Domestic Chip Companies and Market Dynamics - Optimism is expressed regarding the capabilities of domestic chip companies, with Horizon Robotics expected to gain more opportunities amid U.S.-China tech competition [7] - The market is anticipated to be characterized by multi-party competition rather than a one-sided dominance [7] Collaborations and Partnerships - The company maintains close collaborations with leading humanoid robot enterprises in China, demonstrating proactive market engagement and significant progress in joint efforts [13] - The partnership with Diguang Robotics is highlighted, showcasing successful deployment of open-source models and the development of generalized kits based on Diguang chips [12] Conclusion - The robotics domain controller industry is poised for significant growth driven by technological advancements and competitive dynamics, with a focus on collaboration and innovation to navigate the evolving landscape [1][4][12]

Group 1: Industry Standards and Regulations - The Ministry of Industry and Information Technology has released a draft for mandatory national standards on "Safety Requirements for Intelligent Connected Vehicle Combination Driving Assistance Systems," establishing a safety baseline for intelligent connected vehicle products [1] - The draft emphasizes that systems can only be activated under their designed operating conditions and sets comprehensive safety technical requirements across various functionalities, including human-machine interaction and data recording [1] - The introduction of these standards is expected to drive technological upgrades, accelerate the implementation of advanced intelligent driving, and provide a regulatory framework that enhances consumer safety [1] Group 2: Market Trends and Growth - The penetration rate of L2 and above driving assistance functions in new energy passenger vehicles is projected to reach 82.6% by mid-2025, with a significant increase in the market for vehicles priced below 160,000 [2] - In the first seven months of this year, new car sales equipped with combination driving assistance systems reached 7.76 million units, marking a year-on-year growth of 21.31% and a penetration rate of 62.58% [2] - The current period until next year is seen as a critical window for breakthroughs in automotive advanced driving technology, policy regulations, user acceptance, and business models [2] Group 3: Competitive Landscape and Technology Development - Leading manufacturers are enhancing their driving assistance solutions through strategic collaborations rather than solely relying on in-house development, which is expected to increase the penetration of intelligent driving technologies [3] - Domestic suppliers of components such as lidar, cameras, and radar are strengthening their industry influence and moving towards integrated hardware and software solutions [3] - Companies like Horizon Robotics and Black Sesame are positioned as key players in the advanced driving assistance market, with significant computational capabilities and partnerships with major automotive OEMs [4][5]

Industry Overview - The Ministry of Industry and Information Technology has released a draft for mandatory national standards on "Safety Requirements for Intelligent Connected Vehicle Combination Driving Assistance Systems," aiming to establish a safety baseline for intelligent connected vehicles [1] - The draft emphasizes that systems can only be activated under their designed operating conditions and sets comprehensive safety technical requirements, including human-machine interaction, functional safety, information security, and data recording, creating a "triple safety guarantee" [1] - The standard is expected to drive technological upgrades and accelerate the implementation of advanced intelligent driving, facilitating smoother international expansion for the industry [1][2] Market Trends - The penetration rate of combination driving assistance systems in new passenger cars in China reached 62.58% in the first seven months of this year, with sales of such vehicles amounting to 7.76 million units, a year-on-year increase of 21.31% [2] - By mid-2025, the installation rate of L2-level and above driving assistance functions in new energy passenger vehicles is projected to reach 82.6% [2] - The current period until next year is seen as a critical window for breakthroughs in the maturity of advanced intelligent driving technology, policy regulations, user acceptance, and business models [2] Company Developments - Horizon Robotics is a leading player in the advanced driving assistance solutions market, providing both chips and algorithms, with products like J6P and HorizonCell offering 1120 TOPS computing power [4] - Black Sesame Intelligence has developed the A1000Pro chip with 106 TOPS performance and is collaborating with major automotive OEMs, enhancing its product matrix with the A2000 chip [4] - SUTENG Juchuang has achieved mass production of its high-line count LiDAR products, which are now featured in new models from various automakers [5] - Youjia Innovation has secured multiple contracts in the intelligent driving sector and is investing in high-level driving assistance and L4 autonomous driving solutions [5][6]

Core Viewpoint - The company reported a strong performance in H1 2025, with revenue growth and advancements in autonomous driving technology, indicating a positive outlook for future growth opportunities [1][2]. Group 1: Financial Performance - In H1 2025, the company achieved revenue of 250 million yuan, representing a year-on-year increase of 40.4% [1] - The gross margin decreased by 25.2 percentage points to 24.8% [1] - Adjusted net profit was a loss of 550 million yuan, which reflects an improvement in loss by 89% year-on-year [1] Group 2: Autonomous Driving Business - The revenue from driver assistance products and solutions increased by 41.6% year-on-year to 237 million yuan, driven by an increase in mass production models and enhanced customer acquisition capabilities [1] - The company is advancing multiple chip series, including the A1000 series, which is being used in various models such as Geely Galaxy E8 and Dongfeng Yipai 007/008 [1] - The C1200 series has completed testing in multiple cities and is set for mass deployment with leading new energy customers [1] Group 3: Strategic Partnerships and Market Expansion - The company is deepening collaborations with major automotive clients like Geely, BYD, Dongfeng, and FAW, with a record number of domestic and overseas model designations in H1 2025 [2] - The company anticipates that several models based on its own chips will begin overseas sales in the second half of 2025, with shipments already starting [2] - The expansion into non-passenger vehicle scenarios, such as robotics and low-speed L4 applications, is underway, with strategic partnerships established in the robotics sector [2] Group 4: Future Projections - The company maintains revenue forecasts of 880 million yuan, 1.43 billion yuan, and 1.92 billion yuan for 2025, 2026, and 2027 respectively [3] - The price-to-sales ratios for 2025, 2026, and 2027 are projected to be 12.4, 7.7, and 5.7 times, respectively [3]

Investment Rating - The report assigns a "Buy" rating for Black Sesame Intelligence (02533.HK) as a first-time coverage [1]. Core Views - Black Sesame Intelligence is a leading supplier of automotive-grade intelligent vehicle computing chips and solutions, focusing on autonomous driving products and solutions. The company benefits from the expanding market for autonomous driving solutions driven by the trend of "intelligent driving equality" [5][6]. - Revenue projections for the company are estimated at 792 million, 1.253 billion, and 1.942 billion CNY for 2025, 2026, and 2027 respectively, with year-on-year growth rates of 66.9%, 58.3%, and 55.0% [5][8]. Summary by Sections Company Overview - Black Sesame Intelligence began with high-performance chips for autonomous driving and has expanded into cross-domain computing chips, opening new market opportunities [16]. - The founder holds significant control over the company, and the management team possesses strong technical expertise [18][22]. Main Products - The company offers the Huashan and Wudang series of SoC hardware, focusing on autonomous driving and intelligent imaging solutions. The Huashan series includes the A1000 and A2000 chips, which support various levels of autonomous driving functions [25][26]. - The Wudang series, particularly the C1200 chip, is a pioneer in cross-domain computing, integrating multiple functionalities for smart vehicle control [26]. Financial Analysis - The autonomous driving products and solutions are the primary revenue source, with a projected revenue of 4.38 billion CNY in 2024, accounting for 92.35% of total revenue [38]. - The company has experienced rapid revenue growth due to the mass production of the Huashan A1000 series, with further growth expected from the Wudang C1200 and Huashan A2000 series [39][40]. Market Potential - The global and Chinese markets for ADAS applications are expected to grow significantly, with projected CAGRs of 27.5% and 28.6% from 2023 to 2028 [6][60]. - The company holds a 2.2% market share in the Chinese autonomous driving chip and solution market, ranking fifth, indicating substantial room for growth [67].