China LiDAR Sector: From ADAS to robotics and physical AI; time to revisit

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China LiDAR Sector: From ADAS to robotics and physical AI; time to revisit

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China LiDAR Sector Equities

ChinaFrom ADAS to robotics and physical AI; time to

revisit Auto Parts

Nora Min

Analyst

nora.min@ubs.com

ASP fears priced in, volume upside overlooked +86-21-3866 8905

Following a c45% share price pullback since 4Q25, Hesai/RoboSense are trading at an Paul Gong

undemanding 21x/23x 2027E PE. We believe the market has more than priced in Analyst

concerns over LiDAR pricing pressure, while underappreciating the companies' paul.gong@ubs.com

structural growth opportunities. We remain positive on China's LiDAR sector and expect +852-2971 7868

Hesai/RoboSense to maintain their positions as global leaders and deliver NP CAGRs of Jenny Wang

24%/34% over 2027-30E. We expect robust demand from ADAS and robotics lawn Analyst

mowers (RLM) to shift the market's focus away from pricing concerns and support a S1460523110001

near-term re-rating. In the medium term, we believe advances in autonomous driving jenny-zb.wang@ubs.com

and spatial intelligence products should create further upside, while their potential to +86-21-3866 8837

become core infrastructure providers for physical AI could provide long-term optionality.

ADAS LiDAR: penetration surprise on the upside

Mainstream ADAS LiDAR product ASPs have declined to cRmb1,000. While further

downside risk remains, we think it looks limited. UBS Evidence Lab's "China Auto

Configurations Monitor" data suggests demand continues to exceed expectations: 1)

LiDAR penetration in China NEVs reached c25% in H126; 2) adoption of multi-LiDAR

configurations is increasing, starting from high-end models. We expect strong volume