Research Report Analysis | Dongwu Securities: Ruqi Mobility (9680.HK) demonstrates a trend of "robust growth, reduced losses, and structural optimization," and is initially rated as "Buy."

On March 15, Dongwu Securities released its initial coverage research report on Ruo Qi Travel (9680.HK), giving the company a “Buy” rating. The report is optimistic about the company’s advantages in ride-hailing expansion and Robotaxi commercialization through shareholder synergy and hybrid operation models.

Dongwu Securities analysts believe that Ruo Qi Travel’s performance has shown significant trends of “strong growth, narrowing losses, and optimized structure.” They forecast the company will turn profitable by 2027, with revenues of RMB 5.3 billion, RMB 10.5 billion, and RMB 15.8 billion in 2025-2027, respectively. The current market cap corresponds to three-year PS ratios of 0.3x, 0.1x, and 0.1x.

Market opinions suggest that Ruo Qi Travel’s current PS is significantly below the average PS of leading domestic ride-hailing and Robotaxi listed companies. Coupled with the company’s recent profit improvement trend, the current valuation appears attractive.

Earlier, on March 3, Ruo Qi Travel issued a positive profit forecast, expecting a significant YoY profit increase of over 43.4% in 2025, with total revenue exceeding RMB 5 billion and growing over 100% YoY.

2025-2027 PS below comparable companies’ average

Dongwu Securities notes that Ruo Qi Travel’s performance has demonstrated “strong growth, narrowing losses, and structural optimization.” The company’s revenue structure has evolved from a single ride-hailing service to a dual-driven model of “ride-hailing + technology,” with technology services now the second-largest revenue source, increasing from 8.5% in 2022 to 10.0% in 2024. Additionally, due to business expansion and scale effects, the company has seen continuous improvement in operating efficiency, with expenses related to sales, marketing, general, and administrative costs decreasing significantly from 26.1% and 9.9% in 2021 to 8.0% and 5.5% in 2024, and further to 3.9% and 2.9% in the first half of 2025. Gross profit margin turned positive in the first half of 2025, indicating a continuously improving profitability structure.

Dongwu Securities highlights that multiple core financial indicators reflecting operational quality are improving steadily, suggesting that under the dual forces of scale expansion and refined operations, the company is accelerating toward breakeven. They forecast Ruo Qi Travel will be profitable by 2027, with revenues of RMB 5.3 billion, RMB 10.5 billion, and RMB 15.8 billion in 2025-2027.

Using PS valuation, Dongwu Securities estimates that Ruo Qi Travel’s current market cap corresponds to PS ratios of 0.3x, 0.1x, and 0.1x for 2025-2027, significantly lower than comparable companies like Didi, Cao Cao Mobility, Pony.ai, and WeRide, which have three-year average PS ratios of 18.4x, 13.0x, and 6.6x. Given the company’s steady expansion from the Greater Bay Area to nationwide and the broad potential of Robotaxi platform integration with mainstream L4 technology providers, the initial coverage assigns a “Buy” rating.

Market analysis suggests that, based on industry PS averages, Ruo Qi Travel’s current valuation is undervalued. Coupled with the company’s future growth potential in Robotaxi, there is significant room for market cap appreciation.

Ride-hailing ripple effect has shown results

Public information indicates that in recent years, Ruo Qi Travel’s ride-hailing and Robotaxi services have maintained rapid growth, with related revenue YoY growth accelerating from 21.2% in 2024 to 86% in the first half of 2025. By the end of 2025, its service coverage has expanded to over 110 cities nationwide.

On March 3, Ruo Qi Travel announced its first post-listing positive profit forecast, expecting a YoY profit increase of over 43.4% in 2025, with total revenue exceeding RMB 5 billion and more than doubling YoY. The company stated that revenue growth was mainly driven by a significant increase in ride-hailing orders, while profit improvement was primarily due to enhanced operational efficiency and cost structure optimization, leading to sustained gross profit growth.

This balanced growth in scale and efficiency benefits from Ruo Qi Travel’s early adoption of the “ripple model” for expansion—initially focusing on the high-value Guangdong-Hong Kong-Macao Greater Bay Area, optimizing operations in core regions, then efficiently replicating and gradually expanding to multiple cities nationwide. Dongwu Securities believes that the high population density, strong consumer spending, and ongoing L4 Robotaxi policy support in the Greater Bay Area provide a solid market base for ride-hailing and an ideal testing ground for Robotaxi, facilitating efficient nationwide expansion.

Market consensus holds that in future platform competition, control over compliant operational capacity will be crucial. The report notes that Ruo Qi Travel’s ride-hailing order volume ranks among the top ten nationwide and has established a leading position in compliant operations. It has repeatedly ranked first in the Ministry of Transport’s monthly order compliance rate rankings. As Robotaxi deployment accelerates, China’s ride-hailing market is transitioning from “wild growth” to a new phase of “compliant and intelligent” development. Dongwu Securities forecasts the market will expand to RMB 850.79 billion by 2030, with platform aggregation accelerating traffic dispersion, and Robotaxi becoming a new growth engine.

Hybrid operation enhances resilience during industry reshuffle

Robotaxi, as a disruptive technology in the mobility sector, is reshaping the value logic of global mobility platform companies.

Dongwu Securities believes that with improvements in autonomous driving safety, reductions in hardware costs per vehicle, and gradual policy refinement, China’s Robotaxi market will reach a turning point by 2027. They project the market size will reach RMB 83.1 billion in 2030 and further grow to RMB 709.6 billion by 2035.

As one of the earliest domestic platforms to develop Robotaxi, Ruo Qi Travel has adopted a “mixed operation” strategy since 2022, focusing on “manned + unmanned” hybrid operations to build an open platform, developing both manned ride-hailing and Robotaxi services.

Dongwu Securities is optimistic that this hybrid strategy will strengthen the company’s resilience during industry reshuffle. By leveraging the complementary strengths of manned and unmanned fleets, Ruo Qi Travel can meet daily user demand and maintain profitability while gradually increasing Robotaxi acceptance and capacity, reducing early-stage operational and user experience risks, and improving overall asset utilization. This approach will help accelerate Robotaxi commercialization and lay the foundation for fully autonomous operations in the future.

The report notes that Ruo Qi Travel’s Robotaxi network in the Greater Bay Area has already taken shape and is rapidly expanding. By the end of December 2025, the fleet exceeds 300 vehicles, serving Guangzhou, Shenzhen, and the Guangdong-Macao Deep Cooperation Zone in Hengqin, with nearly 6 million kilometers of safe operation.

In July 2025, Ruo Qi Travel launched the “Robotaxi+” strategy, planning to invest over RMB 1 billion over five years to build a three-tier operation network covering 100 cities, supporting an annual capacity of 100,000 Robotaxis, and collaborating with partners to develop a fleet of over ten thousand vehicles.

Dongwu Securities points out that Ruo Qi Travel’s “Robotaxi+” model does not develop L4 autonomous driving technology in-house but instead integrates autonomous driving companies and other ecosystem resources through an open platform, forming a full-chain collaboration of “R&D-Technology-Platform.” This approach aims to efficiently address common early-stage industry challenges and accelerate large-scale deployment of autonomous driving technology.

Ruo Qi Travel’s unique shareholder ecosystem is a core competitive advantage—founded in 2019 by GAC Group and Tencent, later attracting shareholders like Pony.ai, WeRide, Didi Autonomous Driving, Hengjian Holdings, and Guangzhou Investment, forming a “vehicle + internet + intelligent driving” “iron triangle” with strong synergy in traffic, technology, government relations, and supply chain. The company has integrated WeRide and Pony.ai and is promoting third-party Robotaxi fleets like Luobo Kuaipao.

(Edited by: Jiao Yue)

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