Estun’s 1H26E shows a strong recovery from a low base, but A-share valuation fully reflects optimistic humanoid robot expectations

Overview

This report provides Deutsche Bank’s earnings preview for Estun Automation and initiates coverage of its H shares. It focuses on earnings recovery in 2Q26 and 1H26, the humanoid robot theme catalyst from a potential acquisition of Codroid, and the valuation gap between A and H shares. The analyst expects short-term market sentiment to continue supporting the share price, but sees weaker 12-month risk/reward for A shares and a more balanced profile for H shares.

Core views

The core views are: first, Estun’s 1H26E net profit is expected to grow strongly from a very low base, and the company may issue a positive earnings preannouncement in July; second, the 2026E revenue and net margin forecasts are consistent with company guidance, with earnings improvement driven by sales recovery, the realization of price increases, and expense control; third, a potential Codroid acquisition would make a limited near-term contribution to revenue and profit, but its humanoid robot exposure could improve valuation sentiment; fourth, A-share 2026E P/S is approximately 7.4x and 2026E/2027E P/E is approximately 146x/98x, indicating a fairly full valuation; fifth, H-share 2026E P/S is approximately 3.3x and 2026E/2027E P/E is approximately 64x/43x, with the valuation discount resulting in a more balanced risk/reward profile.

Analysis framework

The report applies an earnings forecast, peer valuation comparison, A/H discount analysis, and a three-stage DCF valuation framework. For the A-share target price, the report raises its medium-term growth assumptions to reflect the opportunity in embodied-AI robots; for the H-share target price, it applies a 35% discount to the A-share target price, close to the average H-share discount among approximately 50 dual-listed companies tracked by Deutsche Bank since 2H24.

Methodology notes

• Valuation methodsThree-stage DCF valuation

  Derive the target price using detailed forecasts for 2026-2028, medium-term assumptions, and the terminal growth rate.

  The report uses a 3.5% terminal growth rate, a 1.8% risk-free rate, a 5% equity risk premium, and a 1.61 beta, deriving a 9.3% WACC.

• Valuation methodsA/H-share discount method

  The H-share target price is based on the A-share target price with a discount applied.

  The report applies a 35% discount to the A-share target price for the H-share target price as the H-share valuation benchmark, referencing the average discount among dual-listed companies.

• market_sentimentTheme catalyst analysis

  The impact of humanoid robot exposure on valuation and market sentiment.

  The report believes Codroid’s short-term financial contribution will be limited, but its humanoid robot exposure could increase market attention to Estun and improve valuation sentiment.

Asset mapping & comparison

Structured mapping from thesis to named assets (strengths, weaknesses, peers, risks).

• Estun A shares 002747.SZ

  Core covered security

  Strengths

  A leading position in China’s industrial robot market, with strong expected earnings recovery in 2026E and an embodied-AI robot opportunity that raises medium-term growth assumptions.

  Weaknesses

  High A-share valuation, with 2026E P/S of approximately 7.4x and 2026E/2027E P/E of approximately 146x/98x.

  Comparison

  Compared with humanoid robot peer UBTECH’s 2026E P/S of 11x, Estun has lower humanoid robot exposure; compared with its own long-term one-year forward P/E of 67.5x, current valuation is high.

  Risks

  A-share valuation could come under pressure if robot demand slows, pricing pressure returns, or the humanoid robot business makes a limited contribution.

• Estun H shares 2715.HK

  Newly covered security

  Strengths

  Lower H-share valuation, with 2026E P/S of approximately 3.3x and a significant discount to A shares, resulting in a more balanced risk/reward profile.

  Weaknesses

  The Hong Kong market is more conservative toward the humanoid robot opportunity, and related companies’ H shares trade at an average discount of more than 50%.

  Comparison

  The report derives the H-share target price by applying a 35% discount to the A-share target price, close to the average H-share discount among dual-listed companies since 2H24.

  Risks

  It faces the same risks related to robot demand, pricing pressure, humanoid robot commercialization, and geopolitics.

• Codroid

  Potential acquisition target and source of theme catalyst

  Strengths

  It has businesses in collaborative robots, embodied robots, and core components, and has launched embodied robot products including Codroid 02, C05-U, and C05-L.

  Weaknesses

  Its 2025 revenue scale was small and it was loss-making, with revenue of RMB50.2mn and a net loss of RMB53mn.

  Comparison

  Relative to Estun group’s 2026E revenue of RMB6bn, its short-term financial contribution is expected to be small.

  Risks

  Theme-based valuation support could weaken if commercialization progresses slowly or model training costs increase.

Key data

• 2Q26E salesRMB1.5bn, up 15% year on yearSales growth would improve significantly from -2% in 1Q26.
• 2Q26E net profitRMB40mnAn improvement from the RMB-6mn loss in 2Q25, but below RMB98mn in 1Q26.
• 1H26E salesRMB2.7bn, up 7% year on yearRevenue is expected to return to growth in the first half.
• 1H26E net profitRMB138mn, up 1960% year on yearThe sharp year-on-year increase is mainly attributable to the low base in 1H25.
• 2026E revenue and net profitRevenue RMB6.0bn; net profit RMB305mn; net margin 5.1%Broadly in line with the company’s guidance of RMB6bn revenue and a 5% net margin.
• Codroid 2025 financialsRevenue RMB50.2mn; net loss RMB53mnThe report expects the potential acquisition to make a limited short-term financial contribution.
• A-share valuation2026E P/S 7.4x; 2026E/2027E P/E 146x/98xAbove the long-term one-year forward P/E of 67.5x.
• H-share valuation2026E P/S 3.3x; 2026E/2027E P/E 64x/43xA substantial discount to A shares, resulting in a more balanced risk/reward profile.
• A-share target priceRMB31.4Raised from RMB20, while the rating remains Sell.
• H-share target priceHK$23.6Hold initiated with coverage.

Impact & implications

In the short term, the earnings preannouncement, profit recovery from a low base, and the humanoid robot theme may continue to support Estun’s share price, particularly its A shares. Over the medium to long term, the report believes A-share valuation already reflects optimistic expectations, and upside would be limited unless the humanoid robot business makes a substantial contribution to group revenue and profit; H shares offer a more balanced risk/reward profile due to their larger valuation discount.

Risks

• Deterioration in robot market demand accompanied by renewed pricing pressure.
• Limited sales contribution from humanoid robots alongside rising model training costs.
• Increasing geopolitical risks weighing on Estun’s overseas sales.
• A-share valuation is already fairly full, creating potential downside if earnings fall short of expectations.
• 2Q26E net profit is expected to be lower sequentially than 1Q26 because 1Q26 included RMB87mn in non-recurring gains.
• The collection cycle for auto-related sales receivables is relatively long, and asset impairment may increase sequentially.

What to watch

• Whether Estun issues a positive earnings preannouncement in July 2026.
• The complete 1H26 results scheduled for disclosure on the evening of August 21, 2026.
• Whether 2Q26E sales growth is supported jointly by battery and electronics end-market demand, the realization of 1Q26 price increases, and the low base.
• Transaction terms, closing progress, and consolidation impact of the potential all-cash acquisition of Codroid.
• Whether the humanoid robot business begins to make a substantial contribution to group revenue and profit.
• Whether the discount between A and H shares continues to widen or narrows.
• Demand, market-share changes, and pricing competition in China’s and Europe’s industrial robot markets.