Le Dong Robotics Goes Public in Hong Kong: Major Transformation Risks Ahead

1. Development History: Breaking Technological Barriers, Eight Years to Evolve into a Global Leader in Visual Perception

1. Entrepreneurial Gene: A Second Venture by the Huazhong University of Science and Technology Alumni Founders Zhou Wei and Guo Gaihua are both alumni of Huazhong University of Science and Technology. They co-founded the balance bike company “Le Xing Tian Xia” in 2012, achieving annual sales of 500 million yuan. In 2017, targeting the gap in robotic perception technology, they established Le Dong Robotics in Nanshan District, Shenzhen, shifting focus to the R&D of core components for intelligent robots.

2. Technological Breakthrough: Defining the “Visual Nervous System” of Robots

• 2018: Launched the first generation of LiDAR and SLAM (Simultaneous Localization and Mapping) algorithms, entering the robotic vacuum cleaner market.

• 2020: Released the world’s first consumer-grade Mini DTOF LiDAR, reducing the overall height of the vacuum cleaner to 90mm, breaking industry bottlenecks.

• 2024: Equipped with its visual perception technology, intelligent robots will exceed 6 million units, becoming the world’s largest robotics company focused on visual perception technology.

3. Scene Extension: Opening a Second Growth Curve In 2024, the first intelligent lawn mowing robot will be mass-produced, with first-year sales exceeding 10,000 units; in 2025, the second-generation product will integrate AI large model algorithms, with total sales exceeding 15,000 units, penetrating the lawn care market in Europe and America.

2. Business Model: “Components + Complete Machines” Dual-Drive, Binding Global Top Clients

1. Core Product MatrixBusiness Line 2024 Revenue Share Representative Products and Technical Advantages Visual Perception Products 94% DTOF LiDAR (Global Shipment Leader), Four-Eye Matrix Sensor Module Complete Machine Products 5% Intelligent Lawn Mowing Robot (AI Boundary Recognition Algorithm)

2. Customer Ecosystem: The “Invisible Engine” of Top Robotics Companies

• Serves 7 out of the top ten household robotics companies globally,as well as all of the top five commercial robotics companies worldwide.

• Customer retention rate increased from 84% in 2023 to 90% in 2024,with a net revenue retention rate as high as145%, confirming the stickiness of technology.

3. Global Layout Products coverover 50 countries, collaborating with over300 robotics companies, with a factory management area of 15,000 square meters in Shenzhen.

3. Actual Controllers and Capital: Huazhong Alumni at the Helm, Alibaba CEO Participates in Investment

• Founding Team:

• Zhou Wei(Chairman): 38 years old, Bachelor’s in Mechanical Engineering and Master’s in Industrial Engineering from Huazhong University of Science and Technology, Forbes China 30 Under 30 Entrepreneur.

• Guo Gaihua(General Manager): 40 years old, Bachelor’s in Electronic Science and Technology and Master’s in Communication from Huazhong University of Science and Technology, leading technology R&D. The two control a total of 39.61% of the company’s shares through a concerted action agreement.

• Capital Support: Completed at least 4 rounds of financing, with investors including Huaye Tiancheng (continuously investing in all 4 rounds), Source Code Capital, and Yuanjing Dingheng controlled by Alibaba CEO Wu Yongming(holding 1.79%).

4. Financial Data: High Growth and Profitability Challenges Coexist

Indicator (RMB)	2022	2023	2024	Trend
Revenue	234 million	277 million	467 million	↑ Compound annual growth rate of 41.4%
Gross Margin	27.3%	25.7%	19.5%	↓ Price pressure due to intensified competition
Net Loss	-73.13 million	-68.49 million	-56.48 million	↓ Loss narrowing
R&D Investment Ratio	41.4%	34.7%	20.3%	↓ Initial signs of scale effects

Key Financial Insights:

• Primary Reason for Revenue Growth without Profit: Rising hardware costs, lawn mowing robot business dragging down profits, sensor price wars.

• Cash Flow Pressure: By the end of 2024, cash on hand is only 46.95 million, with an annual loss of 56.48 million, urgently needing IPO funding.

5. Future Challenges: Balancing Technological Moat and Commercialization

• Intense Industry Competition: The global visual perception market CR5 is only 6.2%, with competitors like Hesai Technology and Sutonju Chuang lurking.

• Strategic Betting Directions:

• Raise funds to upgrade AI algorithms, solidifying LiDAR technology advantages;

• Expand lawn mowing robot production capacity, sprinting into the European and American markets;

• Explore new scenarios in medical and industrial fields, breaking away from dependence on household robots.

Conclusion: From creating “eyes” for robots to personally manufacturing complete machines, Le Dong Robotics’ ambition goes beyond being a technology supplier. However, in the capital-hyped robotics track, whether it can convert 252 patents into sustainable cash flow will be the true test after its listing on the Hong Kong stock market.

6. Risk Factors

1. Financial Risks: Continuous Losses and Cash Flow Pressure

1. Profitability Dilemma

• Three Consecutive Years of Losses: Cumulative net losses from 2022 to 2024 reached 198 million (73.13 million / 68.49 million / 56.48 million), although losses have narrowed, profitability has not yet been achieved.

• Continuous Decline in Gross Margin: Overall gross margin dropped from 27.3% (2022) to 19.5% (2024), primarily due to sensor price wars and an increase in the proportion of low-margin products (sensor revenue accounts for 72.9%, with a gross margin of only 15.2%).

2. Cash Flow Crisis

• Cash Reserves Running Low: By the end of 2024, cash and cash equivalents are only 46.95 million, while current liabilities are as high as 242 million; by April 2025, current liabilities further increase to 405 million, significantly increasing debt repayment pressure.

• Negative Operating Cash Flow: From 2022 to 2024, net cash outflows from operating activities were 40.6 million, 49.1 million, and 29.1 million, indicating insufficient self-sustaining ability.

3. Accounts Receivable Risks

• Trade receivables and notes increased from 70.8 million (2022) to 227 million (April 2025), accounting for an excessively high proportion of revenue; if customers default or delay payments, it will exacerbate cash flow pressure.

2. Operational Risks: Customer Dependence and Cost Control Issues

1. High Customer Concentration

• The top five customers contribute 54.3% of revenue (2024), with the largest customer accounting for 15.3%. If core customers are lost or orders decrease, it will directly impact revenue stability.

2. Cost Growth Exceeds Revenue Growth

• From 2023 to 2024, sales costs increased by 21%/83% year-on-year, higher than the revenue growth rates (18.3%/69%), indicating that scale expansion has not led to profit optimization.

3. Supply Chain Vulnerability

• The top five suppliers account for 42.5% of purchases (2024), with core raw materials like optical components relying on a few suppliers; supply disruptions or price fluctuations may affect production.

3. Industry Risks: Red Ocean Competition and Market Changes

1. Fragmentation in the Visual Perception Sector

• The market share of the top five visual perception technology companies globally is only 6.2%. Although Le Dong ranks first with a 1.6% share, it faces fierce price wars and technological iteration pressures from competitors like Hesai Technology and Sutonju Chuang.

2. Challenges in Breaking Through the Lawn Mowing Robot Market

• High Technical Barriers: Need to solve complex terrain navigation, battery life, and safety standards; in 2024, Shenzhen Senhe Innovation failed to survive due to “manufacturing difficulties”.

• Attacks from Giants: Chasing Technology’s lawn mower shipments are expected to exceed 100,000 units in 2025, while Ecovacs’ overseas sales are expected to increase by 252% in 2024, with Le Dong’s sales only at 15,000 units during the same period, indicating a significant scale disadvantage.

3. Risk of Technological Replacement

• Although LiDAR accounts for 85% of intelligent robot perception systems, low-cost solutions using cameras and AI algorithms may erode the market.

4. Strategic Risks: Transformation Pains and Funding Gaps

1. Transitioning from Component Supplier to Complete Machine Manufacturer

• The complete machine business (lawn mowing robots) accounted for only 5% of revenue in 2024, with gross margins dropping from 49.2% to 33.6%. Building a brand requires facing competition from international giants, and the after-sales system is weak.

2. Unsustainable R&D Investment

• R&D expenditures have exceeded 94 million for the past three years, but the ratio has dropped from 41.4% to 20.3%. If IPO fundraising falls short of expectations, technological upgrades may be hindered.

3. Shadow of Historical Disputes

• The actual controller Zhou Wei was criminally investigated due to a commercial secret dispute over balance bikes (2018); although ultimately acquitted, potential legal risks may affect investor confidence.

Risk Matrix Summary

Risk Category	Key Indicators	Severity	Urgency
Financial Risks	Cash/Current Liabilities=0.19 (2024)	⭐⭐⭐⭐⭐	⭐⭐⭐⭐⭐
Customer Dependence	Top five customers account for 54.3% of revenue	⭐⭐⭐⭐	⭐⭐⭐
Industry Competition	Visual perception market CR5=6.2%	⭐⭐⭐⭐	⭐⭐⭐
Strategic Transformation	Gross margin of complete machine business dropped by 15.6%	⭐⭐⭐	⭐⭐⭐⭐

Conclusion: The technical strength and customer base of Le Dong Robotics are its core assets for entering the Hong Kong stock market, butcash flow depletion andunverified profit model pose existential challenges. If IPO fundraising is successful, it must prioritize debt pressure resolution and accelerate the scaling of lawn mowing robots to balance revenue structure; otherwise, it may fall into the dilemma of “technological leadership but funding chain breakage.”