The Week

HESAI-W gained 3.83% over the four trading days of the week, closing at HK$18.69 and outpacing the Hang Seng Index by roughly 1.64 percentage points. The shares followed a bumpy path: Monday saw a low-open, high-close rally to HK$18.34; Tuesday slumped to an intraday low of HK$16.91 before closing down 6.2%; then Wednesday and Thursday delivered back-to-back rebounds, with Thursday touching a weekly high of HK$19.00 and settling near that peak. Weekly amplitude reached 11.68%, and average daily volume of 7.63m shares was nearly 4x the median, signalling sharply elevated turnover.

Key Events

The week’s main event was the Q2 FY26 earnings release after Tuesday’s close. Net income jumped 60% year-on-year to RMB 70.6m, net revenue climbed 21.9% to RMB 860.8m, and lidar shipments hit a fresh record. The SGI business continued to gain momentum, with management raising the full-year SGI guidance ceiling to RMB 300m and projecting a break-even target by 2027.

Market reaction was mixed. US shares fell in pre-market trading on Tuesday, and the Hong Kong-listed stock slid over 6% on Wednesday as investors fretted over core-business margin pressure and the ongoing decline in lidar average selling prices. The SGI upside, however, provided a counterweight, and the stock rebounded about 3% on Friday. During the week, BofA cut its target price to HK$24, citing a core-business miss; Goldman Sachs trimmed its target to HK$30, flagging an operating-profit shortfall; DBS reiterated its buy rating.

Analyst Ratings

As of this week, 16 institutions cover HESAI-W: 12 rate it buy and 4 rate it overweight, with no hold, underweight or sell ratings. The consensus rating stands at strong buy, and the consensus target price is HK$28.49, implying roughly 52.4% upside from the current price of HK$18.69. The target range spans from HK$24.06 to HK$32.00—a roughly 33% spread that points to meaningful disagreement on valuation. Among 19 peers in the auto-parts and equipment industry, Hesai’s rating rank is fourth.

The Week Ahead

The post-earnings digestion is still underway. Going forward, the focus will be on the pace of SGI order conversion and any signs of stabilisation in core-business gross margins. The wide spread in broker targets means the next catalyst—concrete SGI contract announcements or fresh autonomous-driving policy moves—could trigger a re-rating. The latest session’s flow data also showed large-lot money as a net seller, a short-term dynamic worth watching.

In Short

This week summed up the tension between strong earnings momentum and persistent pricing pressure for Hesai. Profit growth, an upgraded SGI outlook, a strong-buy consensus and a target price more than 50% above spot all provide support. Yet the lidar ASP decline continues to squeeze core margins, prompting some brokers to lower their targets, while the latest session showed large-lot money on the net selling side. What matters next is whether SGI growth can offset the hardware price erosion fast enough, and whether narrowing broker divergence brings a clearer direction.

This article is generated by LongbridgeAI from market data, for information only and not investment advice.