ESTUN AUTOMATION(SZ:002747)2025-08-07 05:17Summary of Estun Automation Co. (002747.SZ) Conference Call Company Overview - Company: Estun Automation Co. (002747.SZ) - Industry: Industrial Robotics and Automation - Current Rating: Downgraded from Neutral to Sell - 12-Month Target Price: Rmb9.90, implying a 57% downside potential from the current price of Rmb24.21 [1][25] Key Points Financial Performance and Forecasts - YTD Performance: Stock has rebounded +16% in 2025 YTD, outperforming both the average return of the China Industrial Tech sector (+13%) and the CSI300 index (+6%) [1][19] - Revenue Forecasts: - 2025E Revenue: Rmb4,710.6 million - 2026E Revenue: Rmb5,442.6 million - 2027E Revenue: Rmb6,224.2 million [3][11] - EPS Forecasts: - 2025E EPS: Rmb0.08 - 2026E EPS: Rmb0.28 - 2027E EPS: Rmb0.35 [3][11] - EBITDA: Expected to improve from a loss of Rmb27.2 million in 2024 to Rmb387.3 million in 2025E [3][11] Market Position and Competitive Landscape - Market Share: Estun is the No.1 industrial robot maker in the domestic market, achieving an 11% market share YTD [7][22] - Competition: The humanoid robot market is becoming increasingly competitive, with Estun facing challenges from numerous competitors despite its early-stage R&D in humanoid robots [14][23] End-Market Exposure - High Exposure: Estun has a 38% exposure to unfavorable end-markets, specifically solar (13%) and auto (25%) sectors, compared to an average of 14% for its peers [7][15] - Capex Trends: Expected capex growth in solar is projected to decline by -72% in 2025E and -5% in 2026E, while auto capex is expected to turn negative at -16% in 2026E [7][25] Margin and Profitability Concerns - Stagnant Margins: Despite gaining market share, Estun's margins have shown limited improvement due to persistent pricing competition [13][34] - Earnings Track Record: The company has an inconsistent earnings track record, which raises concerns about its ability to sustain profitability [34] Risks and Upside Potential - Downside Risks: - High exposure to unfavorable end-markets - Stagnant margins despite market share gains - Uncertain outlook for humanoid robot business - Inconsistent earnings performance [34][35] - Upside Risks: - Faster-than-expected market share gains - Shift towards favorable end-markets - Improved margin trends - Accelerated humanoid robot development [27][28][31] Conclusion - Investment Thesis: Estun Automation Co. is positioned as a leader in the domestic industrial robot market but faces significant challenges due to high exposure to unfavorable end-markets, stagnant margins, and intense competition in the humanoid robot sector. The current valuation appears demanding given the substantial downside potential, leading to a Sell rating [34][35]