Investment Rating - The report maintains a Buy rating on Shuanghuan Drive with an unchanged target price of Rmb50.0, indicating an expected share price return of 26.7% and a total expected return of 27.4% [7]. Core Insights - Shuanghuan Drive plans to outgrow the market despite concerns over a potential slowdown in China’s NEV demand in 2026. The company aims to increase dollar content per NEV, focus on overseas projects, and strengthen its cost structure [1][2]. - The company expects to achieve double-digit year-on-year growth in NEV gear revenue in 2026, driven by increased shipments of coaxial gears and differentials [1][2]. - Strong growth is anticipated in the intelligent gear and industrial robot businesses, while revenue from ICE, CV, and CM gear is expected to stabilize [1]. Summary by Sections NEV Gear Strategy - Shuanghuan plans to increase dollar content per NEV by selling more coaxial gears (ASP Rmb1,000-1,200/set) and differentials (ASP Rmb100-200/set), with shipments projected at 6.8 million sets of NEV gears and 1 million sets of differentials in 2025 [2]. - The shipment of differentials is expected to double in 2026 [2]. Overseas Projects - NEV gear exports are projected to rise from 400k-500k sets in 2024 to 700k-800k sets in 2025, and further to over 1 million sets in 2026, primarily driven by demand from Stellantis, Hyundai, Volvo, and Renault [3]. - The ASP and gross profit margin of overseas projects are higher than domestic projects due to a greater percentage of PHEV [3]. Intelligent Gear and Other Segments - Revenue from intelligent gear is expected to grow from Rmb860 million-880 million in 2025 to Rmb1.2 billion in 2026, fueled by demand from robot vacuum cleaners and e-bikes [4]. - Revenue from commercial vehicle gear is anticipated to remain stable in 2026, supported by demand from European tier-1 clients and US electric truck manufacturers [5]. - Construction machinery gear revenue is also expected to stabilize in 2026, despite supplying gears to Caterpillar's large engines [5].