JPMorgan has released a research report initiating coverage on Manycore Tech (00068) with a 'Neutral' rating and a target price of HK$19. The bank notes that Manycore Tech is a leading indoor design SaaS provider in China and holds potential competitiveness in the field of spatial intelligence, or "world models." However, since its IPO, the stock price has risen by 156%, and its current valuation—approximately 26 times price-to-sales and about 180 times the expected 2027 price-to-earnings ratio—represents a significant premium compared to global design software leader Autodesk, which trades at 6 times price-to-sales and 17 times expected price-to-earnings. This suggests the market has already priced in some of its AI potential value.

The bank views Manycore Tech's traditional SaaS business as a high-quality asset. Based on 2024 revenue, the company holds a 23% market share in China's indoor design software market, with subscription revenue accounting for 97% of total revenue in 2025, a gross margin of 82%, and an adjusted net profit margin of 7%. JPMorgan forecasts a compound annual growth rate of 11% in revenue from 2025 to 2028, with the adjusted net profit margin expanding to 17% by 2028. However, the current premium in the stock price indicates that investors are not just paying for its SaaS business but are also optimistic about its AI advantages, particularly its entry into the spatial intelligence field leveraging a database of 480 million 3D models accumulated over the past 15 years.

Although the narrative around spatial intelligence is clear, this business is still in its early commercialization phase, with related revenue estimated at less than $1 million in 2025, and the industry lacks public benchmarks. The bank acknowledges the difficulty in precisely assessing this segment's value and therefore references valuations of similar early-stage projects in the market, such as AMI Labs and World Labs, assigning Manycore Tech a valuation of $4.2 billion, equivalent to HK$19 per share.