Report Summary

1. Electric two-wheelers: have grown into a new basic market. 1) Industry side: trade-in + new strong standards catalyze short-term, product optimization + instant retail development empowers long-term. We believe that in the short term, high-end electric vehicles equipped with lead-acid batteries in the policy context may benefit more, and the production costs of leading enterprises that meet higher safety standards and are equipped with Beidou positioning systems will not increase significantly, so they are expected to have an advantage in the competition. In the medium to long term, the "ease of use" will be improved by function + performance optimization, and electric two-wheelers may also benefit from the expansion of the instant retail industry as a major delivery tool, and the industry still has sufficient growth momentum. Policies such as "oil to electricity" in Southeast Asia are expected to bring opportunities to go overseas.

2) Company side: high-end + intelligent + long-lasting products are strong, and offline stores have accelerated expansion to support growth. In terms of products, the No. 9 two-wheeler is positioned as a high-end vehicle, which is in line with the trend of industry upgrading; Robot gene + strong R&D strength continues to build advantages in the field of intelligence; The self-developed RideyLong+RideyPOWER system supports long battery life and battery safety, and the comprehensive product strength is leading. In terms of channels, as of November 18, 2024, the company has accumulated more than 7,300 offline stores for two-wheelers, and the medium and long-term goal is to lay 10,000 stores.

2. Lawn mower robot: It is expected to replicate the development trajectory of sweepers, and products + channels will boost the strong growth of the business. 1) Industry side: The demand for lawn maintenance in Europe and the United States is large, and the lawn mower robot industry has a broad space with the help of cost. According to the Frost & Sullivan report, there are about 250 million private gardens around the world, with the United States + Europe accounting for 72% of the global total. We estimate that in a three-year cycle, the cumulative cost of hiring someone to mow the grass, purchasing a lawn mower for personal use, and purchasing a lawn mower robot is $4,200, $2,070, and $1,560 respectively, and the initial cost of the lawn mower robot is higher, but the long-term use economy is better than manual maintenance.

2) Company side: The product matrix continues to be enriched, and the channel side makes simultaneous efforts online and offline. In terms of products, compared with the industry, the company's lawn mower robot business has more SKUs, more suitable courtyard areas, and more comprehensive coverage price segments, which has strong competitiveness in terms of cost performance and performance. In terms of channels, the company's intelligent lawn mower robot products have been successfully sold to more than 30 countries around the world, and have become the first non-buried lawn mower brand with 30,000+ user activations.

Investment suggestion: Nine company has strong R&D strength, obvious intelligent advantages, high added value of products, positioning in the middle and high-end, continuous broadening of the product matrix, strong profitability growth, broad prospects for the layout of service robot tracks, sufficient growth momentum, and future revenue performance is expected to maintain a rapid growth trend. We estimate that from 2024 to 2026, the company's net profit attributable to the parent company will be 11.04/17.10/2.255 billion yuan, the corresponding EPS will be 15.40/23.84/31.44 yuan, and the corresponding PE of the current stock price will be 31.12/20.10/15.24 times respectively. Maintain "Buy" rating.

Risk warning: industry policies are becoming stricter, international trade situation risks, exchange rate fluctuations, intensified competition in the electric two-wheeled vehicle market, and technology research and development is less than expected.