Jingwu News | Bocom Intl has released research reports stating that Wuhan and Beijing have both solicited opinions on the development of autonomous driving cars. The Wuhan government supports the development of autonomous driving, with core data ranking first in the country and many scenarios such as cross-region, cross-river, and airport. Beijing's autonomous driving demonstration zone is steadily advancing, issuing more than 380 autonomous driving test licenses to companies including Baidu RoboTaxi, covering 7 districts and about 600 square kilometers.
The operating cost reduction of Baidu RoboTaxi depends on remote safety officers and the mass production of new models. When remote safety officers are introduced, and RT6 (new model, single-vehicle cost reduced to 0.25 million yuan) is deployed, the operating cost will be reduced to the level of taxi operation, or even lower.
The bank pointed out that as of July 10th, Baidu's (09888) share price has risen by more than 10%. The current price corresponds to a P/E ratio of 6.3/5 for the years 2024/25. The bank previously suggested in its monthly report that Baidu's valuation was undervalued and had an opportunity for valuation repair. The bank believes that the short-term transformation of Baidu AI search may still have a negative impact on the company's business, but considering that the company is a leader in autonomous driving layout, and the second and third growth curves have further established opportunities, it maintains a buy rating with a target price of 132 USD/128 HKD.