CICC: Target price of HK$22 for Hesai-W (02525) maintains “outperforming the industry” rating

The Zhitong Finance App learned that CICC released a research report stating that it maintains the Hesai-W (02525) H share and US stock (HSAI.US) “outperforming the industry” ratings. The target price for H shares is HK$22.00 and the target price for US stocks is $22.00, corresponding to the price-earnings ratio of 33.5 times and 32.5 times in 2027, respectively. There is room for improvement of 48.0% and 53.7%, respectively, compared to the current stock price. The bank expects the company's net profit for 2026 and 2027 to be 285 million yuan and 694 million yuan respectively. The company achieved revenue of 1.07 billion yuan in the third quarter of 2026, up 34.3% year on year, up 24.1% month on month, and net profit to mother of 80 million yuan, up 14.5% month on month. The results are in line with the forecast. The bank believes that with the commercialization of Kosmo and the gradual delivery of robot power modules, the SGI business is expected to become a new growth engine.

CICC's main views are as follows:

Results for the third quarter of 2026 are in line with expectations

The company announced results for the third quarter of 2026, achieving revenue of 1.07 billion yuan, up 34.3% year on year and 24.1% month on month; net profit to mother was 80 million yuan, up 14.5% month on month. In the first three quarters of 2026, the company achieved revenue of 2.61 billion yuan, an increase of 28.7% over the previous year; net profit to mother was 170 million yuan. Third-quarter results are in line with this forecast.

The growth rate of lidar has slowed, and SGI commercialization has accelerated implementation

In the third quarter of 2026, the company's lidar shipments increased 65% year-on-year to 729,700 units, and the growth rate was slower than in the first half of the year. Among them, robotic lidar shipments increased 51% year over year to 91,600 units. SGI's business achieved revenue of 90.51 million yuan in the third quarter, of which 23,400 robot power modules were shipped, an increase of 97% over the previous month, and the monthly production capacity reached 10,000 sets. The bank believes that with the commercialization of Kosmo and the gradual delivery of robot power modules, SGI is expected to become a new growth engine.

Gross margin recovered month-on-month, GAAP profit continued

In the third quarter of 2026, the company's gross margin was 41.0%, up 0.9 percentage points from month to month; the cost ratio for the period was 37.5%, down 2.2 percentage points year on year and 2.9 percentage points from month to month. Net profit to mother for the third quarter was $81 million, up 14.5% month-on-month, achieving GAAP profit for 6 consecutive quarters; non-GAAP net profit was 119 million yuan. After excluding the impact of one-time income and exchange gains and losses, core net profit to mother increased 32.8% year over year. The bank believes that with the release of the scale effect of the main business and the expansion of SGI's business, the company's profitability is expected to continue to improve.

The physical AI ecosystem continues to expand, opening up space for medium- to long-term growth

The company released the MT series lidar in September, entered the high-precision surveying and mapping market, and cooperated with JD to expand unmanned delivery and robot applications. The company indicates that SGI's revenue in 2026 will be 200 million to 300 million yuan, and the shipment volume of robot power modules is expected to reach the level of 100,000 sets in 2027. The bank believes that the gradual expansion of SGI's business is expected to open up new growth space for the company.

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Prices of raw materials have risen above expectations; downstream demand has fallen short of expectations; industry competition has intensified.