Goldman Sachs Horizon Robotics (9660.HK): China AI Tour CFO Meeting: Smart Driving Drives Product Mix Upgrade; IP and Software Boost Penetration; Buy
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Goldman Sachs met Horizon Robotics' CFO in Beijing on September 10, 2026, during its China AI tour and maintains Buy. Management remains positive: despite flat shipment growth, mix is improving, with city NOA penetration rising from 23% in 2025 to 30% in 1H26, and models priced under RMB80,000 (US$11,000) expected to use ADAS only while others shift to AD, supporting a move toward higher-value solutions. China L2 ADAS share climbed from 4% in 2022 to 50% in 1H26, versus Mobileye's 25%; China AD share rose from 18% in 2025 to 23% in 1H26, with a target above 50% longer term. Overseas opportunity follows Chinese OEM exports, seen at roughly 10 million units in 2026, where Horizon targets a mid-double-digit attach rate. The chip-plus-software model allows technology/IP licensing or software to OEMs developing in-house chips, an 'ARM + Android' style fee plus per-vehicle royalties; it has pre-purchased memory and MLCC amid tight supply to support 2026-27 shipments. Goldman's 12-month target is HK$13.12 versus HK$4.23, 210.2% upside, based on 29.0x 2030E EV/EBITDA discounted back to 2027E at an 11.5% cost of equity. Forecasts: revenue from RMB3,758 million (2025) to RMB17,879 million (2028E), with EBITDA positive at RMB4,329 million in 2028E. Risks include competition, slower AD mix shift, slower client expansion and geopolitics.