Dongwu Securities: Issue a Buy rating for Audiwei

Zhejiang Dongwu Securities Co., Ltd. Zhu Jieyu, Yi Shenshen, Yu Huiyong, Wu Alan, and Chen Zhexiao recently conducted research on Audiwei and released a research report titled “2025 Annual Report Review: Sensor Application Scenarios Continue to Expand, Domestic and International Industrial Bases Expand Together,” giving Audiwei a buy rating.

Audiwei (920491)

Event: The company released its 2025 annual report, achieving a revenue of 683 million yuan in 2025, a year-on-year increase of 10.72%, and a net profit attributable to shareholders of 94 million yuan, a year-on-year increase of 7.27%. The company plans to distribute a cash dividend of 3 yuan (tax included) for every 10 shares to all shareholders, with a total distribution amount expected to be 42.343 million yuan.

Investment Highlights

The company’s performance is stable and improving, with a gross profit margin unchanged from last year, and exchange loss impacting net profit: By business segment, sensor revenue in 2025 increased by 19.76% year-on-year, mainly due to: 1) the increase in the installation rate of intelligent driving solutions in smart vehicles, with the company strengthening cooperation with major clients; 2) the company achieving technological breakthroughs in collaborative robots for smart home applications, with robot sensor revenue exceeding 110 million yuan for the entire year of 2025. Actuator revenue in 2025 decreased by 29.29% year-on-year, primarily due to a decline in demand in the overseas security terminal retail market, but new generation actuator products have just begun to be introduced into emerging application markets and have not yet formed substantial revenue. The company’s financial expenses for 2025 increased by 91.24% year-on-year, mainly affected by exchange rate fluctuations leading to an increase in exchange losses; in the overall unfavorable automotive industry environment, the company’s sales gross profit margin was 34.82% in 2025, roughly the same as in 2024.

Fields such as smart cars, smart homes, smart terminals, and smart manufacturing drive stable growth in the sensor and actuator market: Sensors and actuators, as core functional components for data collection and intelligent feedback, are continuously meeting the demands for intelligent perception and precise motion control, thereby enhancing their status in fields such as smart cars, smart homes, smart terminals, and smart manufacturing. Frost & Sullivan expects the sensor and actuator market to maintain stable growth, with global and Chinese markets projected to reach approximately $703.6 billion and 1.2096 trillion yuan by 2029, respectively.

Continuous R&D, subsidiary technology investment, plans for H-shares fundraising, and construction of new domestic and international bases: The company’s R&D expenses reached 55 million yuan in 2025, accounting for 8% of revenue, achieving multiple technological breakthroughs. By the end of 2025, the company held 271 valid patents, including 80 invention patents and 178 utility model patents. In December 2025, the company increased its investment by 7.5 million yuan in its subsidiary Aoguanwei, raising its stake to 45%, and has established the first production line for non-contact flexible tactile sensors. At the 2025 Thermal Management Industry Conference, the company officially launched piezoelectric micro-pump liquid cooling technology and a full set of application solutions, applicable to chip-level liquid cooling, industrial robots (joints), drones, and other scenarios with strict requirements for size, energy efficiency, and noise. Regarding capacity expansion, the company began construction of a high-performance sensor R&D and manufacturing base in Guangzhou in July 2025, with a total investment of approximately 200 million yuan; in November 2025, it submitted an application to the Hong Kong Stock Exchange for the issuance of H-shares and listing on the main board, and plans to expand its production base in Malaysia as an overseas hub, with a planned total investment of approximately $54.8 million.

Earnings Forecast and Investment Rating: Considering the slowdown in growth in one of the company’s main downstream industries, the automotive sector, the estimated net profit attributable to shareholders for 2026-2027 is 108/136 million yuan (original forecast 124/150 million yuan), with an additional forecast for 2028 of 166 million yuan, corresponding to PEs of 30/24/19 times. Given the high prosperity of the industry in which the company operates, it is expected to welcome a simultaneous increase in both volume and price in the future, maintaining a “buy” rating.

Risk Warning: Risks of inventory impairment, gross margin fluctuations; risks of overseas investment construction and operation; risks of raw material supply shortages and rising prices, etc.

The above content is organized by Securities Star based on public information and generated by AI algorithms (Internet Information Filing No. 310104345710301240019), and does not constitute investment advice.