Jinwu Financial News | According to Guosheng Securities Research, Horizon Robotics (09660)'s revenue in 2023 was 1.55 billion, of which automotive product solutions/automotive licensing and service/non-vehicle solutions accounted for 33%/62%/5% respectively. According to Insight Consulting, based on the installed capacity of ADAS (Advanced Assisted Driving) and AD (Advanced Autonomous Driving) solutions in the Chinese market in 2023, Horizon ranked fourth, and is the only Chinese company to enter the top five. Without considering assisted driving, Horizon will account for 35% of the market for advanced NOA smart driving computing solutions standard for passenger car fronts in China in 2023, second only to Nvidia's 49%.
The bank believes that in the future, the market space is broad. The driving factors include: 1) (from a quantitative perspective, rapid iteration of technology driving the increase in smart driving penetration rate and load capacity growth; 2) (from the “quantitative” perspective, advanced autonomous driving is gradually advancing, and there are huge differences in “chip solutions” equipped with different levels (for example, Nvidia's smart driving chip list” ranges from 100-2,000 US dollars). The overall ASP of smart driving chips is expected to increase in the future; 3) encouraging policies in various countries are laying the foundation. According to Insight Consulting, the global market for advanced assisted driving and advanced autonomous driving solutions will be about 61.9 billion yuan in 2023, and smart driving solutions are expected to reach trillion yuan in 2030. The vast majority of these markets are advanced autonomous driving solutions. Furthermore, the bank believes that domestic substitution is the general trend, and the domestic chip segment where the horizon is located is growing better.
The bank said it predicts the company's 2024-2026 revenue of 2.2/3.3/5 billion, a year-on-year increase of 44%/45%/53%; net profit to mother -5.3/-1.5/-0.2 billion yuan; and non-GAAP net profit to mother of -1.7/-1/0.3 billion yuan. Since the company is not yet profitable, the bank uses PS valuation. Considering valuation factors such as the company's leading position in the industry and future growth space, the bank believes that the reasonable market value of the company in 2025 is HK$50.4 billion (HK$3.82 per share, calculated at the December 17 exchange rate of $0.9378), which is 9.5 times P/S in 2026. If the company's forward steady state revenue is 7 billion and the steady state net profit margin is 25%, then the target market value corresponds to less than 30 times the forward PE. Covered for the first time, a rating for increasing holdings is given.
