Hengli Hydraulic: Near-Term Revenue From Humanoid Robots Immaterial Compared With Core Business

Hengli Hydraulic’s share price has surged nearly 70% from its January low, driven by optimism surrounding its screw-type linear actuators, a core component for humanoid robots. While we recognize Hengli's potential to benefit as a promising supplier to the growing humanoid robot market, we believe the incremental revenue contribution from this sector will remain immaterial over the next five years. Therefore, we maintain our fair value estimate of CNY 58 and view the shares as overvalued.