China Galaxy Securities: The smart body industry has strong alpha properties, the focus is on the leading companies in the mainframe and key component segments.

China Galaxy Securities released a research report stating that the focus of the 26H2 smart body intelligent market will first concentrate on the production pace of major manufacturers, followed by breakthroughs in model capabilities and scene implementation, and finally by continued order verification exceeding expectations. Compared to other new productive industries, the smart body intelligence industry currently has advantages in terms of speed of advancement and long-term potential, and possesses strong alpha characteristics. At the same time, as the direction has not yet converged, there are key recommended directions with significant differentiation or marginal changes in various aspects. The main points of China Galaxy Securities are as follows: Review In the second quarter of 26, smart body intelligence entered a deep adjustment period, mainly due to the slower-than-expected production of Optimus V3, combined with sector rotation. The sector heat began to rise continuously since the second quarter of 26, and a trend of market recovery has appeared. Currently, valuations are at historical median levels, with fund holdings temporarily at a low level. Outlook In the medium to long term, the start of the "15th Five-Year Plan" clearly defines the future industrial positioning of smart body intelligence, and the year of mass production is also a good opportunity for value growth layout. In the short term, the market focus for the second half of 26 will first continue to be on the production pace of major manufacturers, followed by breakthroughs in model capabilities and scene implementation, and then by continued order verification exceeding expectations. As mass production progresses, Capex in the supply chain is gradually opening up, potentially bringing a new round of investment opportunities for the industry. Focus on leading companies in the main machine and key components The company estimates global shipments of 50,000 to 100,000 units in 26, doubling compared to the previous year. 1) In the short term, Tesla's position in Optimus is difficult to shake, but there is a need to pay more attention to domestic development speed and its impact on the supply chain. Developing technologies like the brain separately from manufacturing, or outsourcing solutions may become viable paths, giving birth to important "leading players in the chain". 2) The priority for verification in industrial and special scenarios remains high, but commercial services have already reflected real demand. In the key components section, the company is more optimistic about leading companies that have already taken the lead and have experience in large-scale production. Clever hands or the last mile of mass production also involve significant marginal changes, and it is also recommended to focus on the heat management direction. Pay attention to areas with potential for growth, and optimistic about electronic skin and lightweight areas Electronic skin technology has high barriers, high long-term potential, and is expected to demonstrate greater flexibility in the next round of market trends. Smart body intelligence affects power consumption, heat dissipation, costs, and many other factors on multiple levels. Material substitution logic has significant marginal changes and is expected to bring about noticeable flexibility. Risk warning Risks include technological breakthroughs falling short of expectations, risks in the development progress of downstream applications, and so on.