Investment Rating - The report assigns a Buy rating to Horizon Robotics-W (09660 HK) with a target price of HKD 3 72 [1] Core Views - Horizon Robotics is positioned to benefit from the global intelligent driving market which is expected to grow to a trillion-level market size The company provides cost-effective integrated hardware and software solutions to OEMs and Tier 1 suppliers making it well-positioned to capitalize on the trend of intelligent driving technology penetration into lower-tier markets [4][6] - The company's valuation is based on projected revenues of RMB 2 375 billion RMB 3 561 billion and RMB 5 954 billion for 2024 2025 and 2026 respectively with corresponding PS ratios of 19 1x 12 7x and 7 6x [6] Industry Overview - The global intelligent driving market is expected to grow significantly with the adoption of end-to-end autonomous driving technology The market size for advanced driver-assistance systems (ADAS) and high-level autonomous driving solutions is projected to increase from RMB 619 billion in 2023 to RMB 10 172 billion by 2030 with a CAGR of 49% [9] - End-to-end autonomous driving which uses neural network models to replace traditional modular designs is expected to drive the market forward with significant improvements in data processing efficiency and deployment lightweighting [9] Company Analysis - Horizon Robotics has established itself as a leading provider of intelligent driving solutions in China with a 35 9% market share in the domestic OEM ADAS solutions market in the first half of 2024 [75] - The company's hardware and software integrated solutions cover a wide range of applications from low to high-end autonomous driving with products like Horizon Mono Horizon Pilot and Horizon SuperDrive [20] - Horizon Robotics has a strong R&D team with over 1 500 employees in intelligent driving hardware and software development and has accumulated more than 1 900 global intellectual property rights [23] Financial Performance - Horizon Robotics' revenue has shown rapid growth with revenues of RMB 4 67 billion RMB 9 06 billion RMB 15 52 billion and RMB 9 35 billion for 2021 2022 2023 and the first half of 2024 respectively [29] - Despite being in a loss-making phase the company's net loss has been narrowing with net losses of RMB 20 64 billion RMB 87 20 billion RMB 67 39 billion and RMB 50 98 billion for the same periods [31] Competitive Landscape - Horizon Robotics is competing with global leaders like NVIDIA and Tesla in the intelligent driving domain control chip market In 2024 Horizon's Journey 5 and Journey 3 chips achieved market shares of 5 4% and 2 5% respectively in China [66] - The company's Journey 6P chip with a computing power of 560 TOPS surpasses NVIDIA's Orin-X and Tesla's FSD 4 0 in performance positioning Horizon as a strong competitor in the high-end market [73] Future Outlook - Horizon Robotics is expected to benefit from the trend of high-end intelligent driving technology penetrating into the mid-tier market particularly in vehicles priced below RMB 200 000 The company's cost-effective solutions are well-suited for this segment [83] - The company's Horizon SuperDrive solution combined with the Journey 6 chip offers a high-performance intelligent driving system that is expected to drive future growth [85]
地平线机器人-W：端到端向下沉市场普及成燎原之势，地平线软硬一体构筑坚实壁垒