与中国SKF合作成立合资企业，用于人形精密部件;买入

Leader Drive (688017.SS) Forming a JV with SKF for Humanoid Precision Components in China;Buy CITI’S TAKESKF (SKFb.ST, covered by Klas Bergelind) announced on 2 July that it has signed an agreement to establish a JV in China with Leader Drive (LD),focusing on high-precision transmission components for robot joints, andSKF will hold 60% majority stake in the venture. Our talk with mgmt. of LDshows thatthe JV will mainly produce different kinds of bearings usedon rotary actuators or other parts of humanoid robotssince SKF hasgreat expertise in bearing technology while LD has deep know-how inharmonic reducers and humanoid robot joints. Although LD didn’tdisclose the capacity of this JV, mgmt. indicated that the capacity will beready before the end of 2026. The JV will serve not only China but alsoEurope, Japan, and the US. We expect a positive share price reactionsince, in our view, this JV again reaffirms LD’s leading position inhumanoid robot joints. Jamie WangAC+852-2501-2772jamie.ck.wang@citi.com Eric Lau+852-2501-2726eric.h.lau@citi.com See Appendix A-1 for Analyst Certification, Important Disclosures and Research Analyst Affiliations Not for distribution in the People's Republic of China, excluding the Hong Kong Special Administrative Region and QualifiedForeign Institutional Investors. Why do SKF and LD need each other? –Although LD produces harmonic reducers for both industrial robots and humanoidrobots, it outsources bearings manufacturing mainly to Chinese suppliers. If LD’s harmonic reducer products could adoptbearings from SKF, we believe that LD could further improve the durability of its reducers and hence strengthen its productcompetitiveness not only in China but also in overseas markets. Since the main products of the JV are bearings, we believe itmakes sense that the JV is 60%/40% owned by SKF/LD. Adding Upside 90-Day Short-Term View on Leader Drive (688017.SS) We expect LD’s share price to react positively to the JV established by SKF and LD on high-precision transmission componentsfor robot joints, as in our view, this cooperation again reaffirms LD’s leading position in harmonic reducers for humanoid robots.Besides, we also believe that the production ramp-up of humanoid robots in the US in 3Q26 could be a positive share pricedriver. Bull/Bear: Leader Drive Leader Drive Valuation Our target price for LD of Rmb496 is based on 322x 2027E P/E, set at +1.5x SD to reflect its stronger-than-expected visibilityfor both humanoid and industrial robots. Risks Key fundamental downside risks that could cause the stock price deviate from our target price include: 1) slower growth in theautomation market; 2) intensifying competition from foreign or local brands due to industry consolidation; 3) higher rawmaterial costs eroding GPM; and 4) lower contribution from humanoid robot and other emerging applications. SKF (SKFb.ST; SKr260.8; 2; 02 Jul 26; 17:30) Valuation We set our SEK 246 target price based on our SOTP. Our implied EV/EBIT against the 20% ROCE and LSD growth potentialsuggests ~11x 2027 clean EBIT for SKF Industrial, which doesn’t suggest much share price upside on our forecasts. Here we use4x 2027 clean EBIT for Automotive given our view of a likely LSD FCF-margin, backend loaded FCF generation and flat-liningROCE (and in-line with WACC), and against a likely market cap which will be among the lowest in the global Autos supplierspeer group, on our analysis. Risks Upside risks to our target price are faster NWC improvement, further material cost cutting, higher growth than our LSDassumption to 2030. Downside risks to our target price are slower GDP and IP and LVP growth, or execution risks around theself-help measures such as the upcoming cost cutting. If you are visually impaired and would like to speak to a Citi representative regarding the detailsof the graphics in this document, please call USA 1-888-500-5008 (TTY: 711), from outside theUS +1-210-677-3788 Appendix A-1 ANALYST CERTIFICATION The research analysts primarily responsible for the preparation and content of this research report are either (i) designatedby “AC” in the author block or (ii) listed in bold alongside content which is attributable to that analyst. If multiple ACanalysts are designated in the author block, each analyst is certifying with respect to the entire research report other than(a) content attributable to another AC certifying analyst listed in bold alongside the content and (b) views expressed solelywith respect to a specific issuer which are attributable to another AC certifying analyst identified in the price charts orrating history tables for that issuer shown below. Each of these analysts certify, with respect to the sections of the reportfor which they are responsible: (1) that the views expressed therein accurately reflect their personal views about eachissuer and security referenced and were prepared in an independent manner, including with respect to Citigroup GlobalMarkets Inc.