上市捷报丨沙利文助力知行汽车科技（苏州）股份有限公司成功赴港上市(1274.HK)

Zhihang Automobile Technology (Suzhou) Co., Ltd. (Stock Code:1274.HK) on2023year12month20The company successfully listed on the main board of the Hong Kong capital market. It is an autonomous driving solution provider focusing on autonomous driving domain controllers and is one of the few companies in China that has achieved large-scale commercialization of autonomous driving solutions. Frost & SullivanFrost & Sullivan,Frost & Sullivan (hereinafter referred to as 'Frost & Sullivan') provides exclusive industry advisory services for the listing of Zhihang Auto Technology (Suzhou) Co., Ltd. We hereby extend our warmest congratulations on its successful listing.

Zhihang Auto Technology (Suzhou) Co., Ltd. (hereinafter referred to as 'Zhihang Auto Technology') was established on2023year12month20The company plans to go public on the 1st of July2,211.6010,000 sharesHstocks, among which221.16Ten thousand shares are for Hong Kong offerings,1,990.44Ten thousand shares are for international offering. The issue price per share is29.65HK$, with the net amount of raised funds being approximately5.95HK$10 billion.

During the process of listing in Hong Kong this time, Frost & Sullivan mainly undertook the following tasks: helping the issuer accurately and objectively understand its positioning in the target market, using objective market data to discover, support and highlight the issuer's competitive advantages, assisting the issuer, investment banks and other intermediaries in completing the writing of relevant parts of the prospectus (such as the overview, competitive advantages and strategy, industry overview, business and other important chapters), helping the issuer complete communication with the Hong Kong Stock Exchange and investors, assisting investors in quickly understanding the market ecosystem and competitive landscape, and assisting the issuer in completing feedback from the Hong Kong Stock Exchange on various industry-related issues.

Investment highlights

The company is a competitive provider of autonomous driving solutions in China;

The company possesses advanced autonomous driving technology;

The company possesses market-proven autonomous driving solutions and the capability for large-scale commercialization of products;

The company has an autonomous driving solution and product portfolio covering a wide range of price segments;

The company maintains a good partnership with leading enterprises in the industry;

The company has an experienced management team and a strong shareholder base.

According to a report by Frost & Sullivan:

press2022In terms of revenue from autonomous driving domain controllers, the company is the fourth-largest provider in China;

press2022In terms of revenue from autonomous driving domain controllers, the company is the second-largest third-party provider in China;

The company is one of the few in China that has achieved large-scale commercialization of autonomous driving solutions;

2022The market scale of autonomous driving domain controllers for passenger vehicles in China in98Yuan billion, expected2026Will reach in645yuan,2022Year-end2026Annual Compound Annual Growth Rate60.1%.

Overview of the Autonomous Passenger Vehicle Market

Autonomous driving refers to the technology that enables vehicles to operate automatically through perception, decision-making, and execution without human driver intervention. Autonomous driving solutions include various components such as sensors (cameras, radars, and lidar), domain controllers, front-facing camera modules, automotive-grade chips, algorithms, and other hardware and software that support the implementation of autonomous driving.SAE International(The Society of Automotive Engineers) classifies automotive automation into six levels based on the degree of human intervention and the scope of driving scenarios.

Source:SAE InternationalFrost & Sullivan report

Due to increased consumer acceptance and more affordable autonomous driving solutions, the market for autonomous passenger vehicles is rapidly expanding. It is expected that by2026Global sales of autonomous passenger vehicles will reach42.2One million units, penetration rate56.8%, to2030Will reach in60.6One million units, penetration rate78.3%At the same time, it is expected that by2026In China, the sales volume of autonomous passenger vehicles will reach18.6One million units, penetration rate reaches73.5%, to2030Annual achievement24.7One million units, penetration rate reaches92.7%.

Source: Frost & Sullivan report

Note:

（1The autonomous vehicles in the above charts refer only toL2-L5Level vehicles, excludingL1Grade vehiclesL1Level 4 vehicles typically do not have an autonomous driving domain controller.)

（2The penetration rate is calculated by dividing the number of autonomous driving passenger vehicle sales by the total number of passenger vehicle sales for the same year.

Overview of the Autonomous Driving Domain Controller Market

Autonomous driving functions are typically achieved through perception, decision-making, and execution processes. As the brain of autonomous driving solutions, the autonomous domain controller connects to various sensors around the vehicle (such as cameras, radars, and lidar), integrates and processes data from these sensors, makes driving decisions, and triggers actuators within the vehicle.

Source: Frost & Sullivan report

Given the growing importance of autonomous driving, the market for autonomous driving domain controllers has expanded rapidly in recent years. The global market size of autonomous driving domain controllers is from2019year5RMB billion growth to2022year165Yuan, with a compound average annual growth rate of211.2%expected2026Will reach in1,154yuan,2022Year-end2026The compound annual average growth rate for the year reached62.6%.

Source: Frost & Sullivan report

Note:

（1The penetration rate is calculated by dividing the number of passenger cars equipped with autonomous driving domain controllers sold by the total number of passenger cars sold in the same year.

Driven by Chinese customers' preference for advanced autonomous driving capabilities, as well as in ChinaOEMDriven by rapid model iteration, the market scale and penetration rate of autonomous driving domain controllers in China have increased significantly.2019Year-end2022The growth rate of China's autonomous driving domain controller market in 2023 was significantly higher than the global average level. The scale of China's autonomous driving domain controller market is2019year1RMB billion growth to2022year98Yuan, with a compound average annual growth rate of341.0%expected2026Will reach in645yuan, with a compound annual growth rate of60.1%Meanwhile, the penetration rate of passenger vehicles equipped with autonomous driving domain controllers in China is at2022Annual achievement4.5%, is expected to be launched in2026year2030The years will grow to35.0%and72.8%.

Source: Frost & Sullivan report

Note:

（1The penetration rate is calculated by dividing the number of passenger cars equipped with autonomous driving domain controllers by the total number of passenger car sales for the same year.

Competitive landscape of autonomous driving domain controllers market

Currently, the market for autonomous driving domain controllers in passenger vehicles in China mainly includes two types of participants, namelyOEMAnd third-party autonomous driving domain controller providers.OEMDevelop autonomous driving domain controllers independently, apply them to their own models, and do not sell them to third parties; Third-party autonomous driving domain controller providers refer to those thatOEMCompanies designing, developing, and producing autonomous driving domain controllers.2022In terms of revenue from autonomous driving domain controllers, Zhihang AutoTech is China's fourth-largest provider, with a market share of8.6%.

press2022In terms of revenue from autonomous driving domain controllers, Zhihang AutoTech is the second-largest third-party provider in China, with a market share of26.2%.

Driving factors for the autonomous driving domain controller market

· The market for autonomous passenger vehicles continues to grow

The development of the autonomous driving domain controller market is related to that of the autonomous driving passenger vehicle market. Due to the trend towards electrification in vehicles, technological progress, cost reduction, and changes in consumer preferences, the sales of autonomous driving passenger vehicles globally and in China are growing rapidly.OEMInvestments in this field continue to increase, driving a rapid rise in the penetration rate of autonomous driving domain controllers and a swift expansion of the market for autonomous driving domain controllers.

· carE/EArchitecture transformation

AdvancedE/EArchitecture isOEMA necessity for maintaining competitive advantage. Therefore,OEMLayouting the carE/EThe architecture has been upgraded from distributed to domain centralized. Compared with traditional distributedE/EArchitecture, domain controllers have many advantages, such as lower overall vehicle cost, lower wiring complexity, lighter weight, lower software development difficulty, and shorter vehicle verification cycles. In addition, domain controllers can improve subsequentOTAUpgrade efficiency. ThroughOTAUpgraded, an autonomous driving solution providerOEMThe latest autonomous driving features can be provided to drivers throughout the entire lifecycle of the vehicle. In the future, more advanced features are expected to be launched.E/EThe architecture of automotive models has driven the rapid expansion of the autonomous driving domain controller market.

· L2+The development of Level 4 autonomous driving

More and moreOEMWe are actively deploying nearL3Features of Level 4 autonomous driving, especially in high-end models.NoAFor example, in recent years, there have been severalOEMThe highway-equipped model has been launchedNoAFunctional models, and we are deploying them in citiesNoAFunctionality. Such advanced autonomous driving functions require more powerful autonomous driving domain controllers, thereby continuously driving the demand for high-performance autonomous driving domain controllers.

· Technological progress drives cost reductions

SoC architectureIt is the most important hardware in autonomous driving domain controllers, and its performance determines the overall performance of the autonomous driving domain controller to a certain extent. Computing power refers toSoC architectureThe ability to process data within a certain unit of time. Usually, it is equipped with high computing power.SoC architectureThe autonomous driving domain controller can execute more complex autonomous driving tasks, such asNoAIn recent years, both international and domestic chip manufacturers have increased their investment inSoC architectureDevelopment investment. In addition, withSoC architectureTechnological progress and expansion of production scale,SoC architectureThe unit cost continues to decline.

View the prospectus

Frost & Sullivan has extensive research experience in the automotive and transportation industries, assisting well-known companies in successfully accessing capital markets. Successful listings include: Lüyuan Group (2451.HK), Noco-noco（ NASDAQ: NCNC ),VinFast（ NASDAQ:VFS), Shengshi Dalianlian NASDAQ:SDA), Youpinche (NASDAQ:UCAR), Hesai TechnologyHSAI.NASDAQ), Yikatong Technology ECX.NASDAQ), Buyang International2457.HK), Newton GroupNWTN.NASDAQ), Zhongchuang New Aviation3931.HK), Leapmotor9863.HK), Deutsche Bank Worldwide2418.HK), Kuaidao Taxi2246.HK), NIO AutoNIO.SGX), NIO Auto9866.HK), Canggang Railway2169.HK), Yanguang PearlYGMZ.NASDAQ)Asia Express8620.HK),InfinityL&T（1442.HK),TOMOHOLDINGS（6928.HK), iFlytek IntelligenceEH.NASDAQ), Aodima8418.HK), Xiangxing International8157.HK), CIMC Trucks1839.HK), Xunlong1930.HK), CSSC Leasing3877.HK), Chengdu Expressway1785.HK), Tianrui Auto Interior (6162.HK), Beping Holdings2885.HK), Huazhi International2258.HK), Pulin Mountain Formation1809.HK), NIO MotorsNIO.NYSE), Wanlida8482.HK), Qilu Expressway1576.HK), Yingheng Technology1760.HK), Asia Industry1737.HK), Ruifeng Power2025.HK), Gaomeng Technology8065.HK), Hebei Yichen1596.HK), Zhengli Holdings8283.HK), JunGao Holdings8035.HK), Yadi Group1585.HK), Yihai Car RentalEHIC.NYSE), Xincheng Power (1148.HK), Zhengxing WheelsZX.NYSE), Shuanghua Holdings1241.HK), Changfeng Axle (1039.HK).