Summary of Horizon Robotics Conference Call Company Overview - **Company**: Horizon Robotics (9660.HK) - **Industry**: Technology, specifically focusing on cloud computing and intelligent driving technology Key Points and Arguments 1. **Share Placement and Subscription**: - Horizon Robotics completed a share placement and subscription in October 2025, issuing 639 million shares at HK$9.99 per share, raising net proceeds of HK$6.4 billion [1][2][4] 2. **Use of Proceeds**: - The net proceeds will be allocated as follows: - 60% for R&D to advance technological capabilities - 20% for investment in business partners - 10% for investment in emerging sectors - 10% for overseas business expansion [3][4] - The company plans to fully utilize these proceeds by the end of 2027/2028E [4] 3. **Overseas Expansion**: - Horizon Robotics is expanding operations in the EU market and securing design wins from Japanese OEM clients [4] 4. **R&D Focus**: - The company is investing in cloud resource expenses to iterate its model and plans to invest in emerging sectors, including Robotaxi [4] 5. **Earnings Revision**: - Revenue projections for 2027-2030 have been revised upwards by 1% to 5% due to expectations of higher penetration of the company's SoC platform [5][9] - Net income (NI) is expected to increase by 5% to 7% in the same period, while EPS revisions are minimal, reflecting share dilution from the subscription shares [9][10] 6. **Financial Metrics**: - The target price has been revised to HK$14.11 based on an EV/EBITDA multiple of 26.0x, reflecting the company's growth potential [10][14] - The company is projected to achieve significant revenue growth, with estimates reaching Rmb 33.98 billion by 2030 [12][16] 7. **Risks**: - Key risks include increased competition, slow product mix upgrades, slower customer base expansion, and supply chain risks due to geopolitical tensions [15] 8. **Market Position**: - Horizon Robotics aims to capture a larger market share in the ADAS & AD China market, with projections indicating growth from 2% in 2021 to 35% by 2027 [12] Additional Important Information - **Valuation Methodology**: The valuation is based on the correlation of EBITDA growth and trading EV/EBITDA multiples of peers, with a discounting back to 2026E using a COE of 11.5% [14] - **Market Capitalization**: As of the report, the market cap is HK$113.2 billion [16] - **Investment Recommendation**: The recommendation remains a "Buy" based on the company's growth prospects and strategic investments [1][10]

Summary of Horizon Robotics Conference Call Company Overview - **Company**: Horizon Robotics (9660.HK) - **Industry**: Technology, specifically focusing on cloud computing and intelligent driving technology Key Points Financial Highlights - **Shares Placement**: Completed in October 2025, issuing 639 million shares at HK$9.99 per share, raising net proceeds of HK$6.4 billion [1][2] - **Use of Proceeds**: - 60% for R&D to advance technological capabilities - 20% for investment in business partners - 10% for investment in emerging sectors - 10% for overseas business expansion [3][4] Growth Strategy - **R&D Focus**: Investment primarily directed towards cloud resource and intelligent driving technology advancements, including the mass production of HSD (Horizon Robotics SuperDrive) and the Journey 6P platform [1][4] - **Market Expansion**: Plans to expand operations in the EU and secure design wins from Japanese OEM clients [4] Earnings Revision - **Revenue Projections**: Revised upwards by 1% to 5% for 2027-2030, driven by the company's SoC platform with a higher price-to-performance ratio [5][9] - **Net Income**: Expected to increase by 5% to 7% in 2027-2030 due to higher revenues despite lower gross margins and increased operating expenses [9][10] Valuation - **Target Price**: Revised to HK$14.11 based on an EV/EBITDA multiple of 26.0x, reflecting the company's growth potential [10][14] - **Market Capitalization**: Approximately HK$113.2 billion [16] Risks - **Key Risks**: - Increased competition and pricing pressure in the auto supply chain - Slower product mix upgrades towards autonomous driving - Delays in expanding the customer base - Supply chain risks due to geopolitical tensions [15] Financial Metrics - **Revenue Growth**: Expected to grow significantly from Rmb 1,552 million in 2023 to Rmb 33,984 million by 2030, with a projected revenue CAGR of 68% from 2025 to 2030 [12][13] - **Gross Margin**: Expected to decline from 70.5% in 2023 to 53.1% by 2030 [12][13] Conclusion - Horizon Robotics is positioned for growth through strategic investments in R&D and market expansion, despite facing competitive and operational risks. The revised target price reflects confidence in the company's long-term potential in the technology sector. The recommendation remains a "Buy" based on the anticipated growth trajectory and market positioning [1][10][14].