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Hesai Group Class B
(2525)
Select Model
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Rating:62Neutral
Price Target:
HK$14.50
▼(-9.49% Downside)
Action:Reiterated
Date:10/29/26
The score is driven primarily by improved fundamentals and a strong balance sheet, but is held back by weak cash-flow quality and negative free cash flow. Technicals are also unfavorable with the stock below key moving averages and negative MACD. Offsetting factors include a positive earnings-call backdrop with raised SGI guidance and continued ~40% gross margin, while valuation (P/E ~27 with no dividend) is not a clear support.
Positive Factors
Revenue growth and profitability
Sustained year-over-year growth alongside improving profitability indicates expanding customer adoption and operating scale. Nine consecutive quarters of revenue growth provides evidence that momentum is linked to broader business development, supporting reinvestment and stronger earnings potential over the next several quarters.
Negative Factors
Weak cash conversion
Negative free cash flow means reported earnings are not yet translating into internally generated funding, increasing reliance on balance-sheet resources to support growth. If investment and working-capital needs remain elevated, this could constrain flexibility and reduce the quality and durability of near-term profits.
Read all positive and negative factors
Positive Factors
Negative Factors
Revenue growth and profitability
Sustained year-over-year growth alongside improving profitability indicates expanding customer adoption and operating scale. Nine consecutive quarters of revenue growth provides evidence that momentum is linked to broader business development, supporting reinvestment and stronger earnings potential over the next several quarters.
Read all positive factors
Hesai Group Class B (2525) vs. iShares MSCI Hong Kong ETF (EWH)
Market Cap
HK$17.53B
Dividend YieldN/A
Average Volume (3M)9.31M
Price to Earnings (P/E)27.1
Beta (1Y)1.88
Revenue Growth38.53%
EPS Growth341.50%
CountryHK
Employees1,118
SectorGeneral
Sector StrengthN/A
IndustryAuto - Parts
Share Statistics
EPS (TTM)0.43
Shares Outstanding1,045,146,900
10 Day Avg. Volume18,965,261
30 Day Avg. Volume9,307,118
Financial Highlights & Ratios
PEG Ratio-0.10
Price to Book (P/B)2.48
Price to Sales (P/S)7.34
P/FCF Ratio-98.74
Enterprise Value/Market CapN/A
Enterprise Value/RevenueN/A
Enterprise Value/Gross ProfitN/A
Enterprise Value/EbitdaN/A
Forecast
1Y Price Target
HK$26.76Price Target Upside67.04% Upside
Rating ConsensusStrong Buy
Number of Analyst Covering10
EPS Forecast (FY)0.43
Revenue Forecast (FY)HK$4.86B
Hesai Group Class B Business Overview & Revenue Model
Company Description
Hesai Group, including its affiliated entities, specializes in the creation, manufacturing, and global distribution of three-dimensional Light Detection and Ranging (LiDAR) technologies. Its market reach extends across Mainland China, Europe, Nort...
How the Company Makes Money
Hesai primarily makes money by selling LiDAR sensors (hardware units) to customers, with revenue generally recognized from product shipments under customer purchase orders or supply arrangements. The core revenue stream is sales of automotive-orie...
Hesai Group Class B Earnings Call Summary
Earnings Call Date:Aug 18, 2026
(Q2-2026)
| % Change Since: |
Next Earnings Date:Nov 10, 2026
Earnings Call Sentiment Positive
The call emphasized strong, broad-based growth: revenue +22% YoY, healthy ~40% gross margin, significant shipment scaling (lidar shipments +~80% YoY; robotics lidar nearly tripled YoY), multiple design wins, SOP readiness for Picasso, and SGI moving from R&D to early commercialization with raised guidance. Near-term headwinds include SGI operating losses as the company invests, connected‑party concentration with Sharpa, competitive pricing pressure, higher R&D spend and regulatory uncertainty. On balance, operational scale, profitability, design wins, and upgraded SGI outlook outweigh the risks, but execution and regulatory pressures merit monitoring.Positive Updates
Revenue Growth and Profitability
Total net revenues reached RMB 861 million (USD 127 million) in Q2 2026, up ~22% year-over-year; GAAP net income was RMB 71 million (USD 10 million), up 60% YoY; non-GAAP net income RMB 101 million (USD 15 million). This marks nine consecutive quarters of YoY revenue growth.
Negative Updates
SGI Operating Loss and Early-Stage Investments
SGI recorded an operating loss of RMB 64 million in Q2 as the company invests heavily in product development, commercialization and capacity expansion; SGI revenues remain small in absolute terms (RMB 45 million in Q2) despite rapid early traction.
Read all updates
Q2-2026 Updates
Positive
Negative
Revenue Growth and Profitability
Total net revenues reached RMB 861 million (USD 127 million) in Q2 2026, up ~22% year-over-year; GAAP net income was RMB 71 million (USD 10 million), up 60% YoY; non-GAAP net income RMB 101 million (USD 15 million). This marks nine consecutive quarters of YoY revenue growth.
Read all positive updates
Company Guidance
Management raised full‑year 2026 SGI revenue guidance from RMB 100 million to RMB 200–300 million (Q2 SGI revenue RMB 45m), and reiterated group-level targets including Q3 revenue of RMB 1.1–1.15 billion with lidar shipments of ~800k–850k and SGI contributing high‑8‑digit revenue in Q3; full‑year lidar shipments are reiterated at 3.0–3.5 million units (about 1.1M shipped in 1H), Q2 lidar shipments were >628k (ADAS >485k, robotics >142k), robotics lidar is expected to exceed 500k for the year and to grow multiple‑fold, SGI is expected to reach ≈USD 100m (~RMB 700m) and breakeven in 2027, Kosmo is on track to contribute revenues in Q3 with a low‑8‑digit initial contribution this year, actuation modules had cumulative shipments >10,000 by end‑Q2 and are ramping toward ~10,000 modules/month with 6‑digit volumes expected in 2027, and the company maintained a ~40% gross margin with Q2 total revenue RMB 861m, GAAP net income RMB 71m and non‑GAAP net income RMB 101m.Hesai Group Class B Financial Statement Overview
Summary
Income Statement
76
Positive
Balance Sheet
84
Very Positive
Cash Flow
34
Negative
| Breakdown | TTM | Dec 2025 | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 3.33B | 3.03B | 2.08B | 1.88B | 1.20B | 722.00M |
| Gross Profit | 1.36B | 1.27B | 884.59M | 661.38M | 471.99M | 468.22M |
| EBITDA | 469.27M | 609.50M | 43.40M | -385.93M | -247.15M | -259.53M |
| Net Income | 497.91M | 435.88M | -102.38M | -475.97M | -300.76M | -240.83M |
Balance Sheet | ||||||
| Total Assets | 11.00B | 11.26B | 5.99B | 5.66B | 3.84B | 4.85B |
| Cash, Cash Equivalents and Short-Term Investments | 6.66B | 4.76B | 3.20B | 3.14B | 1.86B | 3.44B |
| Total Debt | 798.07M | 999.48M | 739.26M | 559.24M | 63.59M | 0.00 |
| Total Liabilities | 2.05B | 2.30B | 2.06B | 1.80B | 997.66M | 7.90B |
| Stockholders Equity | 8.95B | 8.96B | 3.93B | 3.86B | -3.15B | -3.05B |
Cash Flow | ||||||
| Free Cash Flow | 0.00 | -225.21M | -207.85M | -357.41M | -936.40M | -550.00M |
| Operating Cash Flow | 0.00 | 116.99M | 63.50M | 57.26M | -696.01M | -280.08M |
| Investing Cash Flow | 0.00 | -5.55B | 955.88M | -1.06B | 1.12B | -1.95B |
| Financing Cash Flow | 0.00 | 4.35B | 250.68M | 1.59B | 15.18M | 2.36B |
Hesai Group Class B Technical Analysis
Negative
16.02
Price Trends
16.00
Negative
16.43
Negative
19.92
Negative
Market Momentum
-0.88
Positive
46.07
Neutral
63.23
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For HK:2525, the sentiment is Negative. The current price of 16.02 is above the 20-day moving average (MA) of 14.32, above the 50-day MA of 16.00, and below the 200-day MA of 19.92, indicating a bearish trend. The MACD of -0.88 indicates Positive momentum. The RSI at 46.07 is Neutral, neither overbought nor oversold. The STOCH value of 63.23 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for HK:2525.
Hesai Group Class B Risk Analysis
Hesai Group Class B disclosed 91 risk factors in its most recent earnings report. Hesai Group Class B reported the most risks in the "Finance & Corporate" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 3 New Risks
1.
If we fail to complete the CSRC filing and other procedures for any future offshore offering or listing, we may be subject to sanctions imposed by the relevant mainland China governmental authority. Q4, 2023
2.
Uncertainties in the interpretation and enforcement of laws, rules and regulations, typically existing in the civil law systems, could materially and adversely affect us. Q4, 2023
3.
We have been added to the list of Chinese companies with alleged ties to the Chinese military issued by the U.S. government agencies and our business and results of operations may be affected. Q4, 2023
Hesai Group Class B Peers Comparison
UnderperformOutperform
Sector (55)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
82 Outperform | HK$3.78B | 6.65 | 26.57% | 12.79% | 22.02% | -10.82% | |
72 Outperform | HK$10.96B | 11.20 | 5.82% | 3.27% | 5.98% | 13.92% | |
70 Outperform | HK$27.02B | 8.03 | 12.11% | 6.63% | 14.21% | 14.88% | |
68 Neutral | HK$13.11B | 8.46 | 7.18% | 4.30% | 0.22% | -23.29% | |
62 Neutral | HK$17.53B | 27.07 | 5.59% | ― | 38.53% | 341.50% | |
55 Neutral | $6.65B | 3.83 | -15.92% | 6.20% | 10.91% | 7.18% | |
48 Neutral | HK$1.13B | -24.78 | -6.42% | ― | -2.96% | -198.48% |
* General Sector Average
HK:2525
Hesai Group Class B
13.90
-8.98
-39.23%
HK:0179
Johnson Electric Holdings
14.20
-21.04
-59.71%
HK:0425
Minth Group
23.06
-11.04
-32.38%
HK:1316
Nexteer Automotive Group
4.37
-2.34
-34.87%
HK:2488
Launch Tech Co. Ltd. Class H
6.26
-2.05
-24.70%
HK:2531
GL-Carlink Technology Holding Limited
3.08
-10.94
-78.03%
Hesai Group Class B Corporate Events
Hesai Group Sets November 10 Board Meeting and Q3 2026 Earnings Call
Oct 20, 2026
Hesai Group has scheduled a board meeting for November 10, 2026, in Beijing/Hong Kong time to review and approve its unaudited quarterly results for the three and nine months ended September 30, 2026, and to arrange for their publication. The timi...
Hesai Group Awards 2.57 Million RSUs to 120 Employees Under 2021 Plan
Sep 30, 2026
Hesai Group has granted 2,570,400 restricted share units, equivalent to the same number of Class B ordinary shares, to 120 eligible employees under its 2021 share incentive plan. The awards were priced at nil and reference market prices of HK$15.5...
Hesai Shareholders Approve Revised Supply Agreement With Sharpa at EGM
Aug 28, 2026
Hesai Group announced that shareholders approved an ordinary resolution at its August 28, 2026 extraordinary general meeting in Suzhou, with voting conducted by poll in line with Hong Kong listing requirements. The vote related to a Revised Supply...
Hesai Group Posts Unaudited Q2 2026 Results and Warns Investors on Lidar Market Risks
Aug 18, 2026
Hesai Group has released its unaudited condensed consolidated financial results for the quarter ended June 30, 2026, prepared under U.S. GAAP for compliance with U.S. and Hong Kong securities regulations. The company cautioned shareholders and pot...
Hesai Group Doubles Lidar Shipments and Triples Net Income in First-Half 2026
Aug 18, 2026
Hesai Group reported strong operational momentum in the first half of 2026, driven by surging demand for its lidar products across automotive and robotics markets. ADAS lidar shipments nearly doubled to 839,345 units year-on-year, while robotics l...
Hesai Group Raises Sharpa Supply Cap, Triggers Investor Approval Process
Jul 31, 2026
Hesai Group has revised its supply arrangement with Sharpa, a connected company controlled by its co-founders, after a surge in demand for LiDAR products, robotic actuators, and related integration services. The new framework agreement, signed on ...
Hesai Group Calls EGM to Approve Revised Supply Deal With Sharpa
Jul 31, 2026
Hesai Group has called an extraordinary general meeting for August 28, 2026 in Suzhou, China, asking independent shareholders to approve, confirm and ratify a revised supply of products framework agreement with Sharpa and a revised annual cap on t...
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.