Hesai Group: Scaling Lidar Leadership Amid Accelerating Autonomous Driving Adoption and Capacity Expansion

Hesai Group Class B (2525) has received a new Buy rating, initiated by Bank of America Securities analyst, Jessie Lo.

Jessie Lo has given his Buy rating due to a combination of factors tied to Hesai’s growth outlook and market positioning. He believes the company is well placed to benefit from accelerating lidar adoption in China as regulations around L3 autonomous driving advance, which should increase the number and value of lidar units per vehicle. Hesai’s recent multi-lidar design win with a leading domestic new energy vehicle manufacturer and its strong shipment growth underpin confidence in its ability to capture this structural demand. In addition, the decision to lift shipment forecasts, despite slightly lower 2026 earnings estimates from higher operating expenses, reflects conviction that volume and content growth will drive long-term value.

Jessie Lo also highlights Hesai’s capacity expansion from 2 million units to over 4 million units by 2026 and the upcoming Thailand plant as key enablers for scaling with industry demand while enhancing its global production network. He views recent technology upgrades and the partnership with NVIDIA’s DRIVE Hyperion platform as reducing margin concerns and reinforcing Hesai’s technological leadership. Furthermore, he sees optionality from Hesai’s move beyond automotive lidar into broader robotics and sensing solutions, positioning the firm as a potential “physical AI” platform. These growth drivers, combined with an upside to his HKD250 price objective versus the current share price and multiple near-term catalysts such as new product launches and further regulatory progress, support his Buy recommendation on Hesai Group Class B.