Self-driving Car Sensor Company to Raise HK$1 billion

Shenzhen-based RoboSense seeks to raise HK$1 billion in Hong Kong becoming one of the first large IPOs in the city for 2024.

The decade-old company is a leader in LiDAR (light detection and ranging) and perception technology and solutions, the critical elements for detection and control for autonomous driving and robotics.

RoboSense counts Cainiao, Alibaba’s logistics firm, as its biggest non-founding shareholder with a 11% stake. Its other investors include China Mobile, Geely Automobile, Xiaomi, Fosun International and China Structural Reform Fund Corp. It has won numerous industry awards including CES Innovation Awards and Automotive News PACE Award and AutoSens Award.

RoboSense has sharpened its competitive edge with advanced technology such as LiDAR-on-chip technology, applications of artificial intelligence as well as having strong commitment to research and development, large and diverse customer base and extensive mass production capabilities, thus giving the company high vertical-integration efficiency.

It is one of the earliest LiDAR companies to develop proprietary chip technology, and the first LiDAR company in the world to achieve mass production of automotive-grade LiDAR products equipped with in-house developed chips. Such hardware developments are supported by AI perception software, HyperVision, which converts raw sensor data collected through LiDAR and cameras into high-quality perception information that can be directly used by autonomous vehicles and robots.

RoboSense’s manufacturing prowess enables it to turn advance technology into products, its two in-house production plants in Shenzhen and one plant in Dongguan, provide automated intelligent manufacturing and high degrees of process control, from prototyping to mass production.

Moreover, in its possession is a comprehensive portfolio of certifications that include TF16949, ISO9001, TS22163, ISO45001, ISO14001 and other automotive-grade quality or safety management system certifications.

Despite the technological strengths, RoboSense has been operating at a loss for three consecutive years. While its revenue for 2020. 2021 and 2022 were 170 million yuan, 331 million yuan and 530 million yuan respectively, its losses for those years were 220 million yuan, 1.6 billion yuan and 2 billion yuan respectively.

RoboSense’s products account for about 29% of the global passenger vehicle LiDAR market by sales at the end of 2023. The LiDAR market space, in spite being new, is highly competitive and already occupied by many companies meaning price pressures eating into revenues are likely, also the rapidly evolving nature of the market means difficulties in predicting adoption rates and thus creating more risks. Supply chain and payment risks are also concerns as stated by RoboSense.

RoboSense plans to invest about 45% of the net proceeds raised from the IPO on research and development, 20% each to enhance capabilities, sales and marketing efforts, and the rest for partnerships and working capital, as its growth strategy will also depend on logistics, broadening client base and attracting and retaining talent.