Morgan Stanley analyst Tim Hsiao upgraded the rating on Hesai Group Sponsored ADR to a Buy today, setting a price target of $26.00.
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Tim Hsiao has given his Buy rating due to a combination of factors including Hesai Group’s increasing market share in the LiDAR sector within China and the anticipated growth in the adoption of L2+ smart driving technologies overseas. Hesai has managed to surpass competitors like Robosense and Huawei in LiDAR shipments, and despite some short-term challenges, there is potential for further volume growth from companies like Xiaomi and Leap Motor.
Additionally, the company is poised to benefit from the expanding market for robotaxis and smart home robotics, which could serve as a significant revenue growth driver from 2026 onwards. With expectations of a higher average selling price and margin profile from these sectors, along with a potential valuation re-rating to 30x 2026 estimated P/E, Tim Hsiao sees a 22% upside potential, raising the price target to US$26.