Summary of Key Points from the Conference Call Industry Overview - The focus is on the **humanoid robot industry**, particularly developments related to **Veichi Electric** and its collaborations with other companies in the sector [1][3]. Company Insights Veichi Electric (688698.SS) - Veichi Electric is a supplier of inverters, servo motors, and PLCs, and has recently expanded its offerings to include rotary joint modules, coreless motors, frameless motors, and dexterous hands for humanoid robots [1]. - The management expressed greater confidence in the production ramp of a leading **US humanoid robot maker** compared to its Chinese clients, citing rigorous product development progress [1]. - The US client's capacity requirement is projected to increase tenfold in 2027, from **1,000 units per week in 2026** to **10,000 units per week** [1]. Collaboration with Rongtai Electric (603119.SS) - Veichi is collaborating with Rongtai Electric to provide dexterous hand solutions for the US humanoid robot maker, establishing a joint venture in Thailand to meet the requirement of producing all components outside of China [3]. - The latest humanoid robot version requires **44 micro motors** for the hands, with a configuration of **22 Degrees of Freedom (DoF)** per hand [3]. Market Projections - The management indicated that the US client has requested Veichi to prepare its capacity by **1H26**, aligning with industry expectations [3]. - The initial capacity requirement is to support **1,000 units** of humanoid robot production per week, with potential growth to **10,000 units per week** by 2027 [3]. Investment Recommendations - Preference is given to component makers like **Hengli Hydraulic (601100.SS)** and **Leader Drive (688017.SS)**, with Hengli Hydraulic being highlighted for its strong market position [1]. Risks - Key risks identified for the humanoid robot industry include: - Weaker demand for excavator and non-excavator components [7]. - Profitability challenges in production plants due to economies of scale [7]. - Lower-than-expected gross profit margins due to product mix changes [7]. - For Leader Drive, risks include slower growth in the automation market, increased competition, higher raw material costs, and lower contributions from humanoid robots [9]. Valuation Insights - Target price for **Hengli Hydraulic** is set at **Rmb135.0**, based on a **52x 2026E P/E** [6]. - Target price for **Leader Drive** is set at **Rmb233**, reflecting a **233x 2026E P/E** due to stronger-than-expected earnings recovery [8]. Conclusion - The humanoid robot industry is poised for significant growth, particularly in the US market, with key players like Veichi Electric and its partners strategically positioned to capitalize on this trend. However, potential risks must be monitored closely to ensure investment stability and growth.

Summary of Key Points from the Conference Call Industry and Companies Involved - **Industry**: Humanoid Robotics - **Companies Mentioned**: - Veichi Electric (688698.SS) - Hengli Hydraulic (601100.SS) - Leader Drive (688017.SS) - Rongtai Electric (603119.SS) Core Insights and Arguments 1. **Veichi Electric's Confidence**: Management expressed greater confidence in the production ramp of a leading US humanoid robot maker compared to Chinese clients, citing rigorous product development progress [1] 2. **Production Capacity Projections**: The US client's capacity requirement is projected to increase tenfold in 2027, from 1,000 units per week in 2026 to 10,000 units per week [1][3] 3. **Joint Venture in Thailand**: Veichi announced a joint venture with Rongtai Electric in Thailand to meet the US client's requirement for components produced outside of China [3] 4. **Micro Motor Requirements**: The latest version of the US humanoid robot requires 44 micro motors for dexterous hands, with a configuration of 22 degrees of freedom (DoF) per hand [3] 5. **Capacity Readiness Timeline**: The US client has requested Veichi to prepare its capacity by the first half of 2026, aligning with industry expectations [3] Additional Important Information 1. **Investment Preferences**: The report suggests a preference for component makers like Hengli Hydraulic and Leader Drive, which are positioned to benefit from the growth in the US humanoid robotics market [1] 2. **Valuation Metrics**: - Target price for Hengli Hydraulic is set at Rmb135.0 based on a P/E ratio of 52x for 2026E [6] - Target price for Leader Drive is Rmb233, reflecting a P/E of 233x for 2026E [8] 3. **Risks Identified**: - For Hengli Hydraulic: Risks include weaker demand for components and lower profitability due to production scale issues [7] - For Leader Drive: Risks include slower growth in the automation market and higher raw material costs [9] This summary encapsulates the key points discussed in the conference call, highlighting the developments in the humanoid robotics industry and the strategic positioning of the companies involved.