Black Sesame Intelligence is the first domestic autonomous driving chip stock to take the lead

On June 30, Black Sesame Intelligence submitted a listing application to the Hong Kong Stock Exchange and planned to be listed on the main board of the Hong Kong stock market. It is reported that Black Sesame Intelligence is the first company to formally submit an A-1 listing document in accordance with the 18C Rules of the Hong Kong Stock Exchange since they came into effect.

According to the prospectus disclosed on the Hong Kong Stock Exchange website, Black Sesame Intelligence plans to use the net proceeds raised from this transaction to develop smart car-grade SoCs, smart car software platforms and autonomous driving solutions, as well as improve commercialization capabilities.

At present, Black Sesame Intelligence has launched a number of products such as A1000, Huashan A1000L, Huashan A1000 Pro, etc., and put them into mass production one after another. Black Sesame Intelligence is the world's third largest supplier in terms of shipments of automotive-grade high-computing power SoCs in 2022. This year, Black Sesame Intelligence predicts that the company's shipments are expected to further increase several times.

What is the product strength?

As a supplier of automotive-grade smart car computing chips and solutions, Black Sesame Intelligence can provide not only automotive-grade chips, but also ADAS and autonomous driving solutions based on self-developed chips, which can provide OEMs and Tier1 provides a full range of services from chips to overall autonomous driving solutions.

In terms of smart car-grade chips, Black Sesame Intelligence has created two series of products based on independently developed IP cores, software algorithms, etc.: Huashan series and Wudang series. Among them, the Huashan series focuses on autonomous driving, while the Wudang series focuses on cross-domain computing. It aims to cater to the cross-domain computing needs of smart cars by integrating autonomous driving, smart cockpit, body control and other computing functions into one SoC.

Looking at specific products, the Huashan series includes Huashan A1000, Huashan A1000L, Huashan A1000 Pro, Huashan A2000 and many other different products. The first three models have all entered mass production.

Image source: Black Sesame Intelligence

Among them, the Huashan A1000 SoC was launched in June 2020 and was developed using a 16nm FFC automotive process. It can provide 58 TOPS computing power at INT8 precision and can handle up to 16 high-definition camera inputs. It fully supports L2+ to L3 autonomous driving. Currently, It has been selected for front-end assembly of mass-produced models by FAW, Dongfeng, Geely, Jiangxi Automobile Group, Hechuang and other car companies, and will usher in large-scale mass production this year.

According to the information disclosed in the prospectus, the HYCAN V09 model is equipped with Huashan A1000 and is expected to be SOP in the fourth quarter of 2023. At the same time, Black Sesame Intelligence is also working closely with Sany Group to install A1000 on its models, which is expected to be SOP in 2023. Based on the Huashan A1000, Black Sesame Intelligence has also jointly developed a software and hardware integrated autonomous driving product with Baidu, which is expected to be launched in the third quarter of 2023.

Image source: Black Sesame Intelligence

Huashan A1000L SoC has been selected for front-end installation of BAIC Group models. This product was launched at the same time as the Huashan A1000 and shares the same system architecture. It can provide 16 TOPS computing power at INT8 precision and can handle up to 8 high-definition camera inputs. Its application focuses on L2 and L2+ autonomous driving.

Based on the A1000, Black Sesame Intelligence has launched an upgraded version of the A1000 Pro. This product has an INT8 computing power of 106 TOPS and an INT4 computing power of 196 TOPS. It is also the first autonomous driving developed and launched by a domestic company with a computing power of more than 100 TOPS. SoC. In the past two years, with the rapid development of autonomous driving, the demand for computing power has continued to increase. This product has also been recognized by many car companies including FAW.

Currently, around autonomous driving applications, Black Sesame Intelligence is stepping up its research and development of the Huashan A2000. The chip will use the 7nm FFC automotive process, is designed to have more than 250 TOPS computing power at INT8 precision, and has a neural network accelerator that supports next-generation algorithms. It is expected to be launched in 2024.

Image source: Black Sesame Intelligence

In addition, Black Sesame Intelligence also released the first product of the Wudang series - Wudang C1200 in April this year. This chip also uses 7nm process technology. A single chip can meet the needs of electronic rearview mirror systems, integrated parking and parking, and infotainment. systems, in-cabin sensing systems and other cross-domain computing scenarios to achieve the integration of cabin and berthing. According to the plan, C1200 will provide samples to OEMs in 2023 to further improve the product matrix.

In addition to automotive-grade chips, Black Sesame Intelligence has also developed complete autonomous driving and V2X solutions based on self-developed chips. The integrated closed-loop autonomous driving solution portfolio BEST Drive provided by Black Sesame Intelligence includes Drive Eye supporting L1 and L2, Drive Sensing supporting L2+ autonomous driving, Drive Brain supporting L3 domain control, Drive Turing supporting next-generation central computing, and Patronus, an active safety system developed for commercial vehicles.

In addition, in response to the emerging roadside autonomous driving solution market, Black Sesame Intelligence has also developed the V2X edge computing solution BEST Road, and cooperated with Bosch to strategically deploy related solutions in vehicle-side and roadside V2X scenarios. plan.

Already ranked among the top tier in the world

In the field of automotive-grade chips, although Black Sesame Intelligence has made good progress in research and development and commercialization, it is still in the stage of "making ends meet".

Image source: Black Sesame Smart Prospectus

According to the information disclosed in the prospectus, Black Sesame Intelligence began to generate revenue through related solutions in August 2018, and will generate revenue through SoC in August 2021. In 2020, 2021 and 2022, Black Sesame Intelligence achieved revenue of 53.02 million yuan, 60.5 million yuan and 165 million yuan respectively, with corresponding operating losses of 293 million yuan, 723 million yuan and 1.053 billion yuan respectively, and the adjusted net loss was 273 million yuan. billion, 614 million yuan and 700 million yuan, showing a trend of expansion year by year.

Autonomous driving products and solutions are the main source of revenue for Black Sesame Intelligence, with revenue of 34.3 million yuan and 142 million yuan in 2021 and 2022 respectively, accounting for approximately 86% of total revenue in 2022.

With the continuous mass production of related products, although Black Sesame Intelligence's revenue is steadily increasing, due to the needs of research and development and market expansion, Black Sesame Intelligence's sales expenses are also increasing year by year from 2020 to 2022, respectively 22.26 million yuan, 50.84 million yuan and 120 million yuan. Among them, R&D accounts for a large part of the cost investment. In 2020, 2021 and 2022, Black Sesame Intelligence’s R&D investment was 255 million yuan, 594 million yuan and 766 million yuan respectively, which is much higher than the actual income. This is actually the current A common problem faced by companies on the autonomous driving track.

According to Black Sesame Intelligence, since the company is in the stage of expanding its business and operations in the rapidly growing automotive-grade SoC and solution market, and needs to continue investing in research and development, it is expected that the net loss in 2023 will increase significantly, and may be Net losses will continue to occur in the short term.

According to the plan, Black Sesame Intelligence will further increase the commercialization of autonomous driving solutions, especially strengthening its efforts in Best Drive, Patronus 2.0 commercial vehicle solutions, MEC V2X solutions based on Huashan series SoC and Huashan SOM series core computing Investment in boards, etc.

At the same time, Black Sesame Intelligence will also actively expand new customers, and has reached strategic cooperation with CSCI and Western Intelligent Network on V2X, as well as cooperation with robotics companies and advanced solution companies in the industry to promote the commercialization of core computing boards.

According to the information disclosed in the prospectus, up to now, Black Sesame Intelligence has reached cooperation with more than 30 automobile OEMs and Tier1s, and has obtained intention orders for 15 models from 10 automobile OEMs and Tier1s. Among them, Huashan A1000 and A1000L will begin mass production in 2022. As of December 31, 2022, the total shipment volume of the A1000 series exceeded 25,000 pieces.

This year, Black Sesame smart shipments are expected to hit a new high. According to estimates and forecasts provided by relevant partner car companies , more than 100,000 SoCs are expected to be delivered in 2023, which is four times the total shipments in 2022.

It is worth noting that according to Frost & Sullivan statistics, based on the shipment volume of automotive-grade high-computing power SoCs in 2022, Black Sesame Intelligence’s market shares in China and the world have reached 5.2% and 4.8% respectively. It is the third largest supplier in the world.

Image source: Black Sesame Smart Prospectus

Combining the current market structure and the information disclosed in the prospectus, it can be inferred that Company A is Nvidia, with market shares in China and the world last year of 81.6% and 82.5% respectively. Company B is Horizon, with market shares in China and the world last year of 6.7% and 6.2% respectively.