UBS initiates coverage on Hesai with Buy rating and $35 price target.

UBS initiates coverage on Hesai with Buy rating and $35 price target.

UBS has initiated coverage on Hesai Group (HSAI), a leading provider of advanced 3D LiDAR technology for autonomous vehicles, robotics, and industrial systems. The investment bank has assigned a Buy rating to the stock and set a price target of $35.

UBS analysts, in their research report, highlighted Hesai's strong performance in the second quarter of 2025. The company reported net revenues of RMB706.4 million (US$98.6 million), a 53.9% year-over-year increase. The quarter also saw a significant rise in ADAS lidar shipments, up 275.8% year-over-year to 303,564 units. Notably, Hesai secured multiple design wins, including a major collaboration with Toyota for its long-range automotive lidar ATX, which will be integrated into Toyota's new energy vehicle model.

The analysts also noted Hesai's robust financial position, with a gross margin of 42.5% and a solid cash position of RMB2,848.9 million (US$397.7 million) as of June 30, 2025. Additionally, Hesai's recent partnerships, such as those with Agtonomy and Alpha Werke for autonomous farming robots, and its successful resolution of all IP-related litigation, further bolster its market position.

UBS's positive outlook is driven by Hesai's leadership in automotive-grade sensor solutions, its strong product pipeline, and its strategic partnerships. The analysts expect Hesai's revenue to grow significantly in the coming years, supported by its expanding customer base and increasing demand for autonomous driving technologies.

References:
[1] https://www.stocktitan.net/news/HSAI/
[2] https://www.stocktitan.net/news/HSAI/