Huatai Securities initiates coverage on HORIZONROBOT-W with a "Buy" rating and a target price of 9.28 yuan

Huatai Securities released a report, initiating coverage on HORIZONROBOT-W (09660.HK) with a "Buy" rating, based on a forecasted price-to-sales ratio of 31.1 times for 2025, and a target price of HKD 9.28. The company is a market-leading supplier of advanced driver assistance chips and solutions for passenger vehicles, aiming to empower cars and robots, driving terminal intelligence.

The firm believes that HORIZON is expected to benefit from the continuous push for rapid growth in advanced driver assistance features by automakers such as Li Auto (02015.HK), BYD (01211.HK), and Volkswagen. Its subsidiary, Digua Robotics, is deeply engaged in the broader robotics field, positioning itself in the robotics chip market. The firm is also optimistic about the company's J6 series chips and urban HSD algorithms ramping up in 2025, gradually opening up product applications in the robotics field. The firm expects HORIZON's chip shipments from 2025 to 2027 to reach 4 million, 5.22 million, and 6.93 million units, achieving revenues of RMB 3.66 billion, 5.54 billion, and 7.82 billion respectively.

The market is concerned about the significant uncertainties surrounding HORIZON's overseas expansion. The firm believes that its overseas competitors Mobileye and TI are lagging in mass production of high-performance chips, while NVIDIA (NVDA.US) has shortcomings in cost control and autonomous driving software capabilities. The demand for advanced autonomous driving in overseas automotive markets is becoming increasingly urgent, and HORIZON has already begun collaborations with leading Tier 1 companies such as Bosch, Denso, and Continental, with prospects of entering overseas markets starting in 2026