Foresight Autonomous Holdings Ltd ADR (NASDAQ:FRSX) is a developer of solutions for advanced driver assistance (ADAS) and fully autonomous (FA) driving applications, based on stereo and quadric camera algorithms. It has completed its daytime ADAS proof of concept and successfully completed three pilot trials with major Chinese OEMs. At the same time China has adopted new regulations, which should rapidly boost take-up of ADAS systems. FRSX also plans to develop an aftermarket driver alert system for sale in the subsidised Israeli market as well as abroad. Associate, Rail Vision, is also forging ahead as an ADAS pioneer in the rail sector, helped by successful trials. With greater market share and market growth prospects in China, we have increased our DCF valuation from NIS3.45 to NIS5.15 per share.
Pilot trials, boost to Chinese demand & new products
Foresight’s strategy to target Chinese OEMs looks especially well timed with the recent announcement by Chinese auto regulators of testing rules which should dramatically boost Chinese levels of active driver alert installations by 2020. Its marketing efforts in China have also paid off with the completion of three successful pilot trials this year with major OEMs. We expect pilot trials to start in EU and other world markets in 2018 and first revenues to be in H119. Demand for the planned aftermarket driver alert system should be boosted in Israel by government subsidies for ADAS installations and FRSX’s links with Israeli vehicle importers.
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