SPDB International released a research report announcing its inaugural coverage of the smart driving chip sector with an overweight rating. The firm initiated coverage on HORIZONROBOT-W (09660) and BLACK SESAME (02533), assigning both companies "buy" ratings with target prices of HK$12 and HK$21.4, respectively.

As the new energy vehicle industry enters its second phase of development, intelligent assisted driving has become a core feature of automotive intelligence. Smart driving chips, being the essential components for realizing intelligent assisted driving functions, are gradually becoming a value highland in the industry chain.

The report indicates that entering 2025, Chinese domestic automakers are vigorously promoting "smart driving democratization" on one hand, driving down the price segment of vehicles equipped with high-speed NOA features. On the other hand, leading new energy vehicle manufacturers are continuing to advance algorithm evolution based on end-to-end architecture. This dual-pronged approach is promoting both volume and price growth for smart driving chips.

Against this backdrop, domestic smart driving chip suppliers are increasingly emerging, leveraging cost-effective chip products and their mass production experience to actively expand their customer base. They also benefit from the domestic substitution trend and are expected to achieve accelerated market share expansion.

According to Frost & Sullivan calculations cited by the firm, the global automotive-grade SoC market reached RMB 57.9 billion in 2023 and is projected to grow to RMB 205.3 billion by 2028, representing a compound annual growth rate of 29%.

China, as an important participant in automotive intelligence, had an automotive-grade SoC market size of RMB 26.7 billion in 2023, which is expected to grow to RMB 102.0 billion by 2028, accounting for 50% of the global market share.