JP Morgan: upgraded ROBOSENSE (02498) rating to "overweight" with target price adjusted to 53 Hong Kong dollars.

J.P. Morgan released a research report stating that the investment rating for RoboSense (02498) has been upgraded from "Neutral" to "Buy", with a target price raised from HK$28.6 to HK$53, equivalent to a forecasted price-to-sales ratio of 5 times in the next year. In addition to accelerated adoption of ADAS and LiDAR in Shanxi Guoxin Energy Corporation's automobiles, J.P. Morgan noted strong demand for various RoboSense applications including Siasun Robot & Automation lawn mowers, autonomous taxis, and logistics, among others. With its digital LiDAR platform, RoboSense has gained incremental design orders in the ADAS and Siasun Robot & Automation fields, improving profit margins, and is expected to drive accelerated shipments and achieve positive net income in 2026. Furthermore, J.P. Morgan believes that RoboSense warrants a revaluation in valuation due to the broader LiDAR application prospects and future growth potential. J.P. Morgan forecasts that LiDAR demand will reach 3.1 million, 6.9 million, and 12.1 million units in 2025, 2027, and 2030 respectively, with penetration rates of 20%, 33%, and 44% (Q2 this year: 18%). Additionally, J.P. Morgan sees strong demand from the Siasun Robot & Automation market, including for Siasun Robot & Automation lawn mowers (RoboSense receiving a significant order of 1.2 million units from a single customer, compared to Siasun Robot & Automation LiDAR shipments of 24,000 units in 2024), autonomous taxis, logistics Siasun Robot & Automation, and mining trucks. J.P. Morgan anticipates that RoboSense will secure more design orders and predicts total LiDAR shipments of 836,000, 1.8 million, and 2.8 million units in 2025, 2026, and 2027 respectively (compounded annual growth rate: 74%; around 30% from Siasun Robot & Automation), with an expected gross profit margin stabilizing around 28% from 2025 to 2027. Adjusted net profits are estimated at RMB 187 million and RMB 493 million in 2026 and 2027. J.P. Morgan forecasts that RoboSense will ship 580,000 units of ADAS and LiDAR in 2025 (22,100 units in the first half of 2025) and expects growth of 124% and 60% to 1.3 million and 2.1 million units in 2026 and 2027 respectively. EMX is set to begin mass production in the second half of 2025, with expected market shares in China of 19%, 25%, and 30% in 2025 to 2027. The bank has raised its 2026 to 2027 forecast for RoboSense's LiDAR shipments by 15% and 39% respectively to reflect a more optimistic outlook on demand for ADAS, LiDAR, and Siasun Robot & Automation LiDAR. Overall, J.P. Morgan projects total revenues of RMB 3.2 billion and RMB 4.7 billion for RoboSense in 2026 to 2027, with Siasun Robot & Automation accounting for 36% and 33%. Considering better-than-expected gross margin improvements, J.P. Morgan now forecasts adjusted net profits of RMB 187 million and RMB 493 million for 2026 and 2027, respectively, representing increases of 19% and 72% from previous forecasts.