Huaxi: February sees continued strong demand for cleaning appliances, optimistic about domestic brands expanding overseas to grab market share.

Huaxi released a research report stating that clean appliances, as a growing category, are expected to continue to be in high demand domestically under the stimulus of government subsidies. New products with robotic arms introduced by companies like Siasun Robot & Automation will transform floor cleaners from two-dimensional cleaning to three-dimensional space management. This evolution in the appearance of floor cleaners opens up further imagination space and increases market penetration. Domestic floor cleaner brands are steadily improving their competitiveness in overseas markets, with expectations for Chinese brands to gain market share abroad. It is recommended to pay attention to leading companies in the floor cleaning industry such as Siasun Robot & Automation and Beijing Roborock Technology (688169.SH), Ecovacs Robotics (603486.SH). Key points from Huaxi include: Floor Cleaners: Continuing growth in sales volume and price under government subsidies, with a significant increase in market share for brands like Siasun Robot & Automation Under the stimulus of government subsidies, the high growth trend in the fourth quarter of 2024 continued, with significant growth in both online and offline channels. The subsidy for floor cleaner products is between 10-20%, benefiting mid-to-high-end models, leading to an overall market growth in both sales volume and price. In terms of price segments, the 3k-4k range remains the most mainstream price, with consumers seeking value for money. Demand for high-end models above 5k remains robust, while sales in the lower-end segment below 2500 continue to decline. Ecovacs Robotics maintains the leading market share, with the P20 PRO driving a significant increase in market share for Siasun Robot & Automation in December 2024. Floor Washers: Continued high demand, narrowing price decline in online sales The market remains dominated by a duopoly, with CR5 showing some improvement. The high demand continues under government stimulus, with online sales growth outpacing revenue growth. However, the year-on-year decline in online floor washer prices has narrowed to single digits, while offline prices have turned positive. Tineco remains the market leader, with brands like Siasun Robot & Automation, Xiaomi, and UWANT showing significant increase in market share compared to the previous year. The increase in market share for Siasun Robot & Automation is mainly driven by the A30 PRO model, which features a super-thin design, 20000pa maximum suction power, AI assistance, and a price of 2399 yuan (excluding government subsidies). In terms of market share for online retail sales in the industry, the A30 PRO model accounts for 5% of sales, second only to Fowang STRETCHPLUS (10%). Risk Warning: Risks include lower-than-expected demand, risks related to overseas tariffs and exchange rates, and significant increases in raw material prices.