Revealing the potential value of investment in the robotics industry, where is the next trillion-dollar market?

Technology may be the sector that attracts the most attention from the capital market throughout 2023, and robots are also among them. For example, as of 14:42 on November 23, 2023, the Robot ETF (159770) has risen by more than 1%. It has risen significantly since the end of October and has attracted market attention. As the introduction of humanoid robots accelerates, our imagination of robots is gradually opening up. So, what catalysis has the robot industry received now, and what room for imagination does it have in the future?

What catalysis has the robot industry received recently?

Since the Ministry of Industry and Information Technology issued the "Guiding Opinions on the Innovation and Development of Humanoid Robots" in early November, the frequency of activities in the field of humanoid robots has continued to increase. In November, Optimus conducted a walking test. It is expected that more new humanoid robot products will be released, and the emergence of Hongmeng operating system and robot application mode has also played a role in catalyzing resonance. Recently, the concept of robots has attracted attention again

Catalyst 1: Optimus walking test expectations in November

Tesla CEO Musk previously revealed that Tesla has produced about 10 Optimus robots and is expected to conduct walking tests in November. According to the agency's speculation, the main purpose may be to test and modify various lower limb joint actuator plans. If the actuator plan goes smoothly, it is expected to be finalized and become the final plan for next year's AI Day.

Catalyst 2: Kepler launches humanoid robot, further confirming the trend of entrepreneurial wave

Kepler, led by the founder of Chunmi, last week released three humanoid robots whose software and hardware are comparable to Optimus. Judging from the display, they can also complete actions similar to Optimus's visual sorting and egg stepping. The appearance structure and parameters are basically comparable to Optimus, using planetary roller screws and harmonic reducer actuators; it is expected to be sold externally in 2024, with a target price of less than US$20,000.

Catalyst 3: Open source Hongmeng system applied to small humanoid robots

Shenzhen Kaihong Digital Industry Development Co., Ltd. and Leju Robot announced that they officially released the first professional-grade humanoid robot based on the open source Hongmeng system. The news has important symbolic significance in the field of robotics. As the underlying system for robot development, Hongmeng system realizes the reuse of software and data on different hardware terminals through cooperation and promotion with other companies, reducing duplication of work for developers. This kind of software empowerment is expected to speed up the iteration of robots

Catalyst 4: Standard research in the field of humanoid robots is further strengthened

On November 21, the "Inauguration Conference of the Humanoid Robot Standardization Working Group and Standardization Technology Seminar" was successfully held in the lecture hall of Beijing Machinery Industry Automation Research Institute Co., Ltd. One of the important results of this conference is the establishment of the humanoid robot standardization working group, which will help strengthen the standard research layout in the field of humanoid robots, promote the development of the humanoid robot industry chain, and use standards to achieve the rapid industrialization and development of my country's independent advantageous technologies. Scale application

Catalyst 5: The news broadcast mentioned humanoid robots, highlighting the increasing importance of the industry

On November 21, the news broadcast stated that since the Ministry of Industry and Information Technology issued the "Guiding Opinions on the Innovation and Development of Humanoid Robots", various regions have begun to increase innovation and cultivation in the field of humanoid robots, in human-computer interaction, machine vision and motion control, etc. Remarkable results have been achieved in this regard, and the industrial chain has become more complete. It is expected that the market size of humanoid robots will reach 20 billion yuan this year. In the next step, my country will adhere to application traction and innovation drive, strengthen central and local coordination, and jointly cultivate world-class robot industry clusters and application demonstration bases. It is expected that by 2025, the average annual growth rate of my country's robot industry operating income will remain above 20%.

The robot industry may arrive at the "dawn" moment, ushering in opportunities for rapid development just like new energy vehicles

There is no doubt that humanoid robots will be industrialized in 2023. It only takes two years for Tesla Optimus to go from concept to prototype. The current point is the intersection of various technological breakthroughs. Iterative upgrades from software to hardware and the continuous progress of GPT large models have brought more possibilities to the industrialization of humanoid robots. Therefore, the "dawn moment" for the industrialization of humanoid robots is coming

Recently, the Ministry of Industry and Information Technology issued the "Guiding Opinions on the Innovation and Development of Humanoid Robots", pointing out that humanoid robots are expected to become a disruptive product after new energy vehicles. Why are humanoid robots benchmarked against new energy vehicles? There are three reasons. The track attributes are similar (large space and long enough industrial chain), the driving factors are similar (product policy cycle), and the industry cycle is similar (from theme growth to business growth).

Tesla’s big move in the field of new energy vehicles not only spawned a series of new domestic car-making forces such as "Wei Xiaoli", but also quickly promoted the rapid growth of its largest competitor BYD, and BYD is even more... In the field of new energy vehicles, a comprehensive closed-loop system has been built to build technical barriers.

Tesla's progress in the field of humanoid robots is expected to once again trigger the "catfish effect" similar to the impact in the field of electric vehicles many years ago. According to industry insiders, if Tesla’s humanoid robot is ultimately successful, a group of humanoid robot industry pioneers like BYD will appear in China

How should we view investment opportunities in the robot industry?

Continuing the above discussion, we will review the stock price cycle of new energy vehicles and gain a deeper understanding of the current investment in the robot industry.

The biggest money-making effect of new energy vehicles is in 1-10 (2019-2021). Global sales of new energy vehicles were 8,000 in 2010 and reached 330,000 in 2014. At present, humanoid robots are still far away from large-scale commercial implementation, and related market opportunities are still in the theme growth stage. However, the difference between humanoid robots and new energy vehicles lies in their innovation and iteration, and even greater growth potential, and the current Tesla It is not the Tesla of the past. The superimposed and reused automobile supply chain may develop faster. Therefore, the maximum profit-making effect of humanoid robots may be 0-1.

Picture: New energy vehicle market review (Source: Tianfeng Electric)

At the same time, multiple forces have also begun to enter the domestic humanoid robot market. These forces include: (1) Manufacturers focusing on robots, such as Daval, Fourier, etc. These manufacturers usually have a certain accumulation of robot technology. (2) Domestic car manufacturers, such as Xpeng Motors, are also making cross-border deployments in the field of humanoid robots. Judging from its parameters, its humanoid robot technology level may be equivalent to that of overseas Tesla. (3) Internet companies, such as iFlytek and Xiaomi, have also become potential competitors in the field of humanoid robots. The application of large-scale models has gradually enabled the "embodied intelligence" of humanoid robots to be realized

From a spatial perspective, the ceiling of the humanoid robot is higher than the car. According to the humanoid robot Musk, which is equipped with 2 units per person (stock market), the annual sales of benchmark cars, mobile phones, and laptops are 80,000-9k units, 1.3-1.4 billion units, and 300 million units respectively. It is expected that the annual sales ceiling of humanoid robots is expected Reaching 200 million units, according to ASP=15W, the market space is expected to reach 30 trillion.

According to valuation data, the valuation of new energy vehicles in 2021 has increased by 50 to 65 times. However, considering the greater potential but lower market share of humanoid robots, its valuation is likely to exceed 50 to 65 times. To put it simply, when the sales volume of electric vehicles reaches 1 million units, its valuation will be approximately 40 to 50 times. However, the market space for humanoid robots is larger than that of cars. Even if sales reach 1 million units, the market share is actually still low. Therefore, valuing 1 million humanoid robots at 50 times is not excessive, and may even increase further

In the long run, humanoid robots have huge market potential in the future and may create a blue ocean application market worth trillions. Taking the field of home services as an example, even if only 5% of households use humanoid robots, the value of the domestic market alone can reach hundreds of billions. Based on its advantages in the industrial chain in the field of artificial intelligence, my country is expected to usher in major opportunities in the future. For example, in the field of new energy vehicles, we have accumulated successful experience and have obvious advantages in intelligent driving, software and hardware integration, industry chain optimization, and vehicle model replacement. At the same time, domestic supply chain companies also have similar advantages in terms of customer response speed, product updates and cost reduction, such as motors, batteries, etc. The proportion of domestic sensors, precision reducers, ball screws and hollow motors will also increase

In the capital market, many people choose to participate in the layout of related industrial companies through index funds. For example, the CSI Robot Index selects the securities of system solution providers, digital workshop and production line system integrators, automation equipment manufacturers, automation parts manufacturers and other robot-related listed companies in the Shanghai and Shenzhen markets as index samples to reflect the impact of robots. Overall performance of the underlying securities among listed companies

Data shows that as of November 22, 2023, the top ten heavyweight stocks in the index include Inovance Technology, Guodian Nari, iFlytek, Dahua Technology, Leading Intelligence, etc., and the top ten heavyweight stocks account for a total of About 51.31%. (Data source: China Securities Index Company, index constituent stocks do not represent individual stock recommendations)

Image source: China Securities Index official website, data as of November 22, 2023

We may expect that another round of technological revolution that will change human society will gradually arrive and will also promote the rapid development of these high-quality enterprises. If you want to look forward to the opportunities for domestic substitution of industrial robots and the opportunity for the explosion of humanoid robots from 0 to 1, pay attention to the Robot ETF (159770). Perhaps the OTC Index Fund Tianhong CSI Robot ETF Link C (014881) is a good choice. Go to Alipay , Tianhong Fund APP, Tiantian Fund and other platforms can be purchased.

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