CMBI Initiates Coverage of Hesse Technology with Buy Rating, Target Price at 269.66 HKD

Summary

CMB International has initiated a ‘buy’ rating for Hesai Technology with a target price of 269.66 yuan. The report highlights the continuous growth in Hesai’s Robotaxi business orders and its strong fundamentals. The target price for Hesai’s US shares has been raised from $27.52 to $34.66 based on a DCF model. Revenue and net profit forecasts for 2026-2027 have been increased by approximately 2% and 6%, respectively. Hesai holds a 33% market share in the pre-installed mass production sector, leading the industry.HongKong Economic Journal+ 2

Impact Analysis

So basically, CMB International’s ‘buy’ rating and the increased target price for Hesai Technology are a strong vote of confidence in the company’s growth trajectory, especially in the Robotaxi sector. The timing is interesting, given the recent signing of a significant $40 million lidar order with a US Robotaxi firm, which underscores the company’s robust order book and market leadership with a 33% share in pre-installed mass production. The upward revision of revenue and profit forecasts for 2026-2027 by 2% and 6% respectively, suggests that analysts see sustainable growth aheadHongKong Economic Journal. The market might be underestimating the impact of upcoming L3 autonomous driving regulations, which could further boost lidar adoption. The trade here could be to go long on Hesai, betting on its continued dominance and the broader lidar market expansion. However, execution risks remain, particularly in scaling production to meet growing demand.