Nomura maintains Buy on Shuanghuan Driveline; robots and Tesla Semi provide long-term upside

Overview

This is a company research preview report by Nomura on Shuanghuan Driveline, focusing on 2Q26F operating performance, visibility on 2026F growth, the robot reducer business, Tesla Semi contribution, and valuation. The report believes the company's new energy vehicle, construction machinery, and robot-related businesses can support medium- to long-term growth, and maintains a Buy rating and a CNY50 target price.

Core views

The report's core judgment is that 2Q26F revenue growth has resilience: new energy vehicle revenue is supported by a return to positive growth in May-June and a ramp-up in coaxial gears in June, while construction machinery maintains strong growth; the decline in internal combustion engine gears is narrowing, and commercial vehicles are broadly flat; smart actuator sales are slightly below previous expectations, but overall full-year financial performance remains broadly in line with guidance. Over the long term, robot reducers and Tesla Semi may gradually contribute incremental growth, although changes in robot technology routes may still affect per-unit value.

Analysis framework

The report adopts an analysis approach combining business-line tracking and valuation multiple methodology: it first breaks down quarterly trends in new energy vehicles, internal combustion engines, commercial vehicles, construction machinery, smart actuators, and robots, and then uses 2027F EPS and historical average P/E as the basis for the target price, while comparing current trading valuation and future EPS CAGR.

Methodology notes

• Valuation methodsP/E multiple method

  25x 2027F P/E

  The CNY50 target price is based on 2027F EPS of CNY1.99 and a 25x 2027F P/E, a multiple broadly close to the 14-year historical average P/E of 26x, and supported by 2026F-2028F EPS CAGR of 16.5%.

• Fundamental breakdownBusiness-line growth analysis

  Break down growth drivers by end application

  The report separately analyzes the businesses of new energy vehicles, internal combustion engines, commercial vehicles, construction machinery, smart actuators, and robots to assess whether 2Q26F and full-year growth are in line with guidance.

Asset mapping & comparison

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

• Shuanghuan Driveline / 002472.SS

  Core covered name

  Strengths

  New energy vehicle gears, construction machinery, and robot reducer businesses provide growth drivers; a diversified customer structure helps narrow the decline in the internal combustion engine business.

  Weaknesses

  Smart actuator sales are slightly below previous expectations, and 2Q26F gross margin is unlikely to exceed 1Q26 due to product mix.

  Comparison

  The target price corresponds to 25x 2027F P/E, close to the 14-year historical average P/E of 26x; currently about 18x 2027F P/E.

  Risks

  Robot customer shipment ramp-up slower than expected, weak construction machinery shipments in 4Q26F, China gear demand below expectations, and market share loss at key customers.

• Robot reducer business

  Long-term growth option

  Strengths

  The company is expected to benefit as robot companies ramp shipments; the current solution for a single robot customer may include 6 RV reducers, and next-generation robots may include 6 cycloidal pinwheel reducers.

  Weaknesses

  Changes in technology routes may alter value per joint, and the pace of demand ramp-up remains uncertain.

  Comparison

  Compared with the traditional automotive gear business, the robot business is more of a source of long-term growth and valuation elasticity.

  Risks

  Route switching by robot manufacturers, unstable pull-in pace, and mismatches between capacity expansion and actual demand.

• Tesla Semi-related commercial vehicle business

  Potential incremental contribution

  Strengths

  Tesla Semi is beginning to launch, and the report expects it may contribute slightly to sales for the full year.

  Weaknesses

  Near-term contribution is still small, and overall commercial vehicle sales are expected to be broadly flat YoY.

  Comparison

  Compared with new energy vehicle gears and construction machinery, Tesla Semi is currently more of an early-stage incremental driver.

  Risks

  Semi ramp-up slower than expected or uncertainty in supply chain timing.

Key data

• RatingBuyNomura maintains a Buy rating.
• Target priceCNY50.00Based on 25x 2027F P/E.
• Current priceCNY35.36Price date is 2026-07-24.
• Implied upside+41.4%Disclosed value derived from the target price and current price.
• New energy vehicle revenue growthYoY +10%-20%Flat in April, returned to positive growth in May-June, with further support from the ramp-up in coaxial gears in June.
• Construction machinery growthYoY +20%-30%The report expects strong growth to continue in 2Q26F.
• Decline in internal combustion engine gearsNarrowing to single digits in 2Q26FThe decline was 20%-30% in 1Q26; the report expects further narrowing in 2H26F and a high single-digit decline for the full year.
• Smart actuator salesabout CNY1.05bnSlightly below the previous expectation of CNY1.1-1.2bn, mainly due to flat market share in robot vacuum cleaners.
• 2027F/2028F EPSCNY1.99 / CNY2.34Raised from the previous CNY1.96 / CNY2.25.
• 2026F-2028F EPS CAGR16.5%Used to support the valuation multiple.

Impact & implications

The implication for the investment view is that the short-term 2Q26F earnings validation will focus on new energy vehicles, construction machinery, and the narrowing decline in internal combustion engines; the medium- to long-term outlook will depend on robot customer shipment ramp-up, the stability of reducer per-unit value, and the pace of Tesla Semi contribution. If these incremental drivers materialize, the company's current 18x 2027F P/E still has room for rerating versus the target valuation.

Risks

• Robot company shipment ramp-up progresses slower than expected.
• Construction machinery shipment performance in 4Q26F is weak.
• China gear demand is below expectations.
• Market share loss at key customers.
• Changes in robot technology routes may alter the company's per-unit value.
• Changes in product mix may pressure gross margin performance.

What to watch

• Whether 2Q26F new energy vehicle revenue achieves 10%-20% YoY growth.
• Whether the June ramp-up in coaxial gears can continue into 2H26F.
• Whether the decline in internal combustion engine gears continues to narrow.
• Whether the construction machinery business can sustain 20%-30% growth.
• Whether smart actuator sales improve from about CNY1.05bn.
• Robot customer shipment pace, reducer units per robot, and ASP changes.
• Whether Tesla Semi begins to make a clearer sales contribution.
• Whether the company further expands robot-related capacity.