We maintain "Buy", but decrease TP to HK$42.17. Robosense (the “Company”) recently announced its EMX LiDAR series in April, and currently has design wins for 17 car models. Despite a revenue decrease this quarter, we expect there to be a significant rebound next quarter, driven by significantly more design wins in 2Q2024, and the seasonality of the lawn mower robot business. We adjust our 2025-2027 revenue forecasts to RMB2,642 mn/ RMB5,259 mn/ RMB8,301 mn, respectively. Our TP is based on a SOTP 2025F EV/S valuation of 2.5x for the ADAS segment and 15.0x for the robotics segment. This results in a 6.1x/ 4.6x/ 3.0x 2025-2027 EV/S Ratio.
　　The Company posted a slight revenue decline for the quarter due to ADAS LiDAR sales declining by -25% YoY due to few 1Q2024 design wins, which was mostly offset by a LiDAR sales increase. We expect a significant revenue rebound next quarter due to there being 15 design wins in 2Q2024 compared with 2 design wins in 1Q2024. Totarevenue for 1Q2025 was RMB345mn, down 4.3% YoY. ADAS LiDAR product revenue was RMB229 mn, down 25.3% YoY. Robotics LiDAR revenue was RMB73.4 mn, up 87.0% YoY. ADAS LiDAR product sales volume was 96.7k, down 16.8% YoY. Robotics LiDAR product sales volume was 11.9k, up 183.3% YoY. ADAS LiDAR ASP was RMB2,367, down 10.1% YoY. Robotics LiDAR ASP was RMB6,168, down 34.0% YoY. Margins experienced significant improvement due to revenue mix changes and due to newer products having higher margins. Totagross margin for the Company was 23.5%, up 11.2 ppts YoY. ADAS gross margin was 15.1%, up 4.5 ppts YoY. Robotics gross margin was 52.1%, up 23.1 ppts YoY.
　　The Company also announced its new EMX series LiDAR in April, since its launch it has obtained 17 vehicle design wins from 5 OEMs, due to the product’s similarity to the existing MX LiDAR product, and we expect deliveries of the product by the end of this year. The Product is designed for L2+ combined assisted driving systems. It features 192 ultra-high beams, generating 2.88 million points per second, with an ultra-high angular resolution of 0.08°×0.1° and a maximum detection range of 300 meters. In addition, the Company also launched two solid-state digitaLiDARs for robotics, the E1R and Airy, broadening its product portfolio for Robots.
　　Catalyst: release of the Company’s 2Q2025 earnings.
　　Risks: OEMs switching to non-LiDAR ADAS/AD solutions.