Hengxuan Technology: Ten years of casting the industry's leading products + applications + brand customer resonance, the company's growth path is clear. On the product side, the company focuses on core technologies such as low power consumption, intelligent audio and video interaction and wireless communication connection technology, and continues to carry out product R&D and innovation around connection needs, and launches four product matrices: smart audio, smart wearable, smart home and wireless connection; In terms of application scenarios, the company continues to make efforts from earphones to smart watches/bracelets, smart glasses, smart homes, AI glasses and other markets, and adheres to the brand development customer development strategy, focusing on global mainstream Android mobile phone brands such as Samsung, OPPO, Xiaomi, Honor, Huawei, and vivo; Professional audio manufacturers such as Harman, Anker Innovations, Edifier, and Wanmo, Internet companies such as Alibaba, Baidu, and Google, as well as home appliance manufacturers such as Haier, Hisense, and Gree, continue to carry out the introduction and promotion of series of products, and form a large-scale scale; Product + application resonance, the company's growth path is clear.

Bluetooth headset: OWS and AI upgrade, SoC ASP upgrade

Bluetooth audio chip is the company's first growth curve. With its Bluetooth audio SoC world-leading low power consumption, noise reduction, connection and other core functional parameters, relying on the brand customer strategy, Hengxuan Technology has realized the introduction and volume of TWS earphones in the global mainstream Android mobile phone brands such as Samsung, OPPO, Xiaomi, Honor, Huawei, vivo and professional audio manufacturers such as Edifier and Wanmo, so as to achieve rapid growth in revenue. The era of OWS and AI headsets is expected to accelerate the acceleration of the proportion of Hengxuan Technology's 2800 and 2700 product structures, and the improvement of SoC ASP, so as to achieve continuous revenue growth.

Watch SoC: The company's second growth curve continues to increase Watch

SoC is the company's second growth curve, with both volume and price rising and continuing to increase at a high rate. Hengxuan Technology is now mainly used for co-processors of smart watches. In 2021, the company officially launched the first-generation watch SoC BES2500BP to the market, and completed the introduction and expansion of customers such as Xiaomi and vivo in the same year. Since then, the company has continued to launch 12nm/6nm watch SoCs, and has successively introduced them to customers such as Huawei, Honor, OPPO, and Samsung, so as to achieve rapid growth in watch SoC revenue. The company is still in the stage of rapid expansion in the watch market, and with the launch of the company's SoC as the main processor of the watch in the future, we believe that the company's growth plate in the watch market will be further opened. Watch SoCs are expected to maintain rapid growth.

AI glasses: The singularity has arrived, and the company's card position is accurate

In 2024, the global sales of AI glasses will be 1.52 million units, of which Ray-Ban Meta will sell 1.42 million units, which will be the main variety in 2024; The explosion of Ray-Ban Meta also verifies the market's demand potential for "lightweight AI glasses". Looking forward to 2025, with the entry of leading hardware and Internet giants such as Xiaomi, Samsung, and Byte, we believe that the singularity of the AI glasses industry has arrived.

S oC is the brain of AI glasses. In the future, with the continuous upgrade of AI glasses, we believe that the SoC solution/SoC+MCU-level SoC solution is expected to become the mainstream solution choice for brand manufacturers in this market due to its outstanding performance such as high computing power, multi-system development, and high AI capabilities. Hengxuan Technology can now provide MCU-level SoCs on the main control chip of AI glasses, and is actively deploying SoC-level solutions. Hengxuan Technology's business expansion in AI glasses is expected to successfully replicate its growth path in the headset and watch/bracelet markets.

It is estimated that the company's net profit attributable to the parent company from 2024 to 2026 will be 4.60, 7.51 and 1.025 billion yuan respectively, maintaining a "buy" rating.



Risk Reminder 1. Risk of product development failure;

2. The terminal form of the product is relatively single;

3. Risk of fluctuation in gross profit margin;

4. The risk that the profit forecast assumption is not valid or falls short of expectations.