Accessible version Jiangsu Hengli Hydraulic Co., Ltd (A) Sales growth to accelerate in 2026; expansion in HR; raise PO to RMB130 Reiterate Rating: BUY | PO: 130.00 CNY | Price: 112.50 CNY Sales growth to accelerate in 2026 with improving GPM Hengli's planned production has been solid in Nov-Dec, mainly supported by the robust demand for excavator cylinders. Its excavator cylinder business has been operating at full capacity in 4Q25. Looking into 2026, we expect sales growth to accelerate (16% YoY, vs. 13% Y ...

Summary of Leader Harmonious Drive Systems 3Q25 Earnings Briefing Company Overview - **Company**: Leader Harmonious Drive Systems - **Industry**: Industrial Robotics and Automation - **Date of Briefing**: November 3, 2025 Key Points Market Position and Growth - Leaderdrive is gaining market share despite a decline in industry profitability, with large orders from two of the global big four industrial robot makers [2] - The company claims a significant share in the humanoid robotics market and anticipates continued fast growth into 2026, driven by demand from leading humanoid integrators [2][4] - Humanoid products currently account for 15-20% of production, with expectations for further increases in 2026 [9] Product Development and Innovation - Leaderdrive has developed self-machining tools that allow for P0 precision level screws, with ongoing optimization for miniature harmonic reducers [3] - Management believes harmonic reducers are the best solution for humanoids due to their size, precision, and output, with no significant client demand for alternative solutions [4] - The company is confident in the performance of miniature harmonic reducers for dexterous hands, despite their high cost [4] Financial Performance - The company reported margin expansion in 3Q25, supported by scale, improved product structure, and new applications with higher prices [9] - Revenue projections for the fiscal years ending in 2024, 2025, 2026, and 2027 are Rmb387 million, Rmb535 million, Rmb691 million, and Rmb861 million respectively [8] - EBITDA is expected to grow from Rmb113 million in 2024 to Rmb242 million in 2027 [8] Capacity and Production - Harmonic reducer annual capacity is projected to ramp up to 1 million units by the end of 2025 [9] - Traditional applications are expected to grow by 10-20% in 2026, with opportunities for market share gains [9] Valuation and Risks - The base case valuation uses a DCF model for humanoid reducer and planetary roller screw segments, estimating a segment value of Rmb114 per share [10] - Risks to upside include stronger-than-expected robot demand and faster humanoid robot adoption, while risks to downside include slower-than-expected humanoid development [12] Stock Performance - As of November 3, 2025, the stock price was Rmb159.50, with a price target of Rmb153.00, indicating a potential downside of 4% [8] Additional Insights - The company is viewed as a leading producer of harmonic reducers in China, with ongoing development in humanoid hardware solutions [4] - Management expects price and margin to gradually decline and then stabilize as production volumes increase [9]

Summary of Shenzhen Inovance Technology Co. (300124.SZ) Conference Call Company Overview - **Company**: Shenzhen Inovance Technology Co. - **Industry**: Industrial Automation and Humanoid Robotics Key Points Industry Positioning - Inovance is positioning itself as a standardized component platform for humanoid robots, focusing on being a core component supplier rather than a full robot OEM [1][2] - The company aims to establish an "Inovance inside" model, emphasizing its role in the supply chain for humanoid robots [1][2] Product Development and Offerings - Inovance has launched products such as rotary and linear actuators, with plans for a bionic arm in the next year [1] - The company claims to achieve leading specifications in motors, drives, and encoders, with a focus on lightweight components with high power density [3][8] - Specific product highlights include: - Frameless torque motor with a maximum torque of 32.24 Nm at 2760 rpm, weighing only 1 kg [8] - Integrated circular drives (48V, 80A, approximately 3 kW) and independent block-type drives (5 kW continuous, 10 kW peak) [8] - Rotary actuators weighing approximately 2.8 kg with peak torque of 310 Nm [8] - Linear actuators achieving a maximum power density of 4 kN/kg [8] Competitive Advantages - Inovance has strong advantages in industrial data accumulation and understanding of industrial know-how, which positions it well in the humanoid robot supply chain [1][12] - The company has built a humanoid R&D team of around 100 people, supported by wider engineering resources [11] - Inovance's motor capacity is approximately 7 million units annually, which exceeds current humanoid robot demand [15] Market Strategy - The management emphasizes a focus on industrial humanoid applications, particularly in material handling, with expectations for early commercialization in generalized handling tasks [7][12] - The company is promoting its products in both domestic and overseas markets, aiming to attract customer adoption rather than customizing solutions for single customers [9][12] Financial Outlook - The investment thesis highlights Inovance's growth potential, with expectations for market share gains in various segments, including EV components and digitalization [14] - The 12-month price target is set at Rmb75.50, with a current price of Rmb81.79, indicating a downside potential of 7.7% [18][17] Risks - Potential risks include slower-than-expected market share gains in industrial automation, weaker margin trends, and slower ramp-up in the EV component segment [17] Conclusion - Inovance is positioned as a competitive supplier in the humanoid robotics industry, with a strong focus on product excellence and market expansion. The company’s strategic emphasis on modularized solutions and data-driven approaches enhances its potential for growth in the industrial automation sector [12][16]

Investment Rating - The report does not explicitly state an overall investment rating for the industry or specific companies [2]. Core Insights - The humanoid robot industry in China is experiencing significant growth, with companies like Orbbec and Rongtai expanding their market presence and revenue projections [3][4]. - The report highlights the increasing demand for components and technologies related to humanoid robots, indicating a robust supply chain development [2][3][4][5][6][7]. Company Summaries Orbbec (688322.SS) - Orbbec's humanoid robot revenue is projected to grow from Rmb4 million in 2024 to Rmb30 million in 2025, with market share in China expected to surpass that of Intel's RealSense [3][10]. - The dollar content for 3D vision technology is anticipated to increase from Rmb4,000-5,000 to Rmb8,000 as it becomes integrated into more parts of the robot [3]. Rongtai (603119.SS) - Rongtai has a ~50% market share in micro ballscrews used in humanoid robots and is expanding its operations by building a factory in Thailand to meet US customer requirements [4][10]. - The company aims to grow its core business by 20%-30% CAGR, driven by rising penetration rates in the humanoid robot supply chain [4]. Hengli (601100.SS) - Hengli plans to reduce the production cost of planetary roller screws to ~Rmb1,000 by the end of 2025 and is considering establishing a plant in Houston, TX, to secure orders from US customers [5][10]. - The company targets a +10% YoY revenue and earnings growth, primarily driven by strong demand in the excavator component business [10]. Bozhon (688097.SS) - Bozhon's subsidiary Linkhou is expected to generate Rmb400 million-500 million in revenue in 2025 by providing components and assembly services to Zhiyuan [6][10]. - The company has sold Rmb20 million-30 million worth of humanoid robot assembly equipment to a leading US humanoid robot maker since 2024 [6]. Wolong (600580.SS) - Wolong aims to become the second electric motor supplier to Zhiyuan, targeting revenue growth from Rmb15 billion in 2024 to Rmb16 billion in 2025 [7][10]. - The company plans to pursue mergers and acquisitions to fuel long-term growth, with net profit expected to rise from Rmb793 million in 2024 to Rmb1.1 billion in 2025 [7][10].