Core Viewpoint - Guodian NARI Technology Co., Ltd. has shown a mixed performance in financing activities and stockholder dynamics, with significant revenue growth and a stable profit margin in recent financial reports [1][2][3]. Financing Activities - On September 10, Guodian NARI experienced a financing buy-in of 63.12 million yuan, while financing repayment amounted to 98.69 million yuan, resulting in a net financing outflow of 35.57 million yuan [1]. - As of September 10, the total financing and securities balance for Guodian NARI was 1.736 billion yuan, with the financing balance accounting for 0.97% of the circulating market value, indicating a high level compared to the past year [1]. - The company had a securities lending activity on September 10, with 29,100 shares repaid and 14,400 shares sold, leading to a selling amount of 319,800 yuan [1]. Financial Performance - For the first half of 2025, Guodian NARI reported a revenue of 24.243 billion yuan, reflecting a year-on-year growth of 20.53%, while the net profit attributable to shareholders was 2.952 billion yuan, up by 8.97% year-on-year [2]. - Cumulatively, since its A-share listing, Guodian NARI has distributed a total of 23.134 billion yuan in dividends, with 11.5 billion yuan distributed over the last three years [3]. Shareholder Dynamics - As of June 30, 2025, the number of shareholders for Guodian NARI was 100,400, a decrease of 8.75% from the previous period, while the average circulating shares per person increased by 9.59% to 79,622 shares [2]. - Among the top ten circulating shareholders, Hong Kong Central Clearing Limited held 1.089 billion shares, a reduction of 27.48 million shares compared to the previous period [3].

Group 1: Solid-State Battery Industry - The solid-state battery industrialization is progressing with support from policies, material advancements, and application developments. Key companies to watch include Xiamen Tungsten, Tianqi Lithium, and others in the supply chain [2][3] - Major developments include the mass production of semi-solid batteries by Zhuhai Guanyu and the upcoming solid-state battery projects by Yiyuan Lithium Energy and others [2] Group 2: Domestic Energy Storage Systems - The domestic energy storage system bidding capacity reached 47.2 GWh in August 2025, reflecting a year-on-year increase of 2158% and a month-on-month increase of 1142%. Cumulative bidding for the year reached 144.1 GWh, up approximately 216% year-on-year [3] - The high demand for energy storage systems indicates a strong need for new power systems in China, laying a foundation for stable market development in 2026-2027. Key companies include Sungrow Power, Yiyuan Lithium Energy, and others [3] Group 3: AIDC Power Equipment Sector - AIDC power equipment companies are expected to benefit from increased capital expenditures, with Alibaba reporting a capital expenditure of 38.7 billion yuan in Q2 2025, up 220% year-on-year [3][32] - The demand for data center construction remains strong, and companies like Jinpan Technology and New Special Electric are positioned to gain from this trend [3][32] Group 4: Power Grid Equipment Sector - Power grid equipment companies are experiencing steady growth, with major firms maintaining robust performance in the first half of 2025. A surge in high-voltage bidding is anticipated in the second half of the year [4][42] - Key companies to focus on include Guodian NARI, Siyi Electric, and others, as they expand their product offerings and international presence [4][42] Group 5: Wind Power Sector - Wind power companies are seeing simultaneous increases in volume and profit, with significant growth in both onshore and offshore projects expected in the latter half of 2025 [4][59] - Companies like Goldwind Technology and Dongfang Cable are recommended for investment as they are well-positioned to benefit from this growth [4][59] Group 6: Investment Recommendations - The report suggests monitoring the recovery of the power grid equipment sector, the progress of offshore wind projects, the advancement of solid-state battery industrialization, and the global demand for energy storage installations [4]

Investment Rating - The investment rating for the company is "Buy" and is maintained [7]. Core Views - The company reported a revenue of 24.24 billion yuan in the first half of 2025, representing a year-on-year increase of 19.5%. The net profit attributable to shareholders was 2.95 billion yuan, up 8.8% year-on-year [2][4]. - The company’s performance in Q2 2025 showed a revenue of 15.35 billion yuan, with a year-on-year growth of 22.5% and a net profit of 2.27 billion yuan, reflecting a 7.3% increase year-on-year [2][4]. - The company’s smart grid and low-carbon energy sectors continue to show strong growth, with overseas revenue increasing by 139.2% [9]. Revenue Summary - In the first half of 2025, the smart grid revenue was 12.225 billion yuan, up 28.4% year-on-year; low-carbon energy revenue was 6.541 billion yuan, up 29.5% year-on-year; and integrated and other revenues decreased by 58.6% [9]. - Domestic revenue reached 22.224 billion yuan, a 14.5% increase year-on-year, while overseas revenue was 1.987 billion yuan, marking a significant increase [9]. Profitability Summary - The gross margin for the first half of 2025 was 26.45%, down 2.48 percentage points year-on-year. The gross margin for Q2 2025 was 27.75%, down 3.82 percentage points year-on-year [9]. - The gross margin for the smart grid segment was 30.34%, down 2.93 percentage points year-on-year, while the low-carbon energy segment had a gross margin of 21.59%, down 1.68 percentage points [9]. Expense Summary - The total expense ratio for the first half of 2025 was 12.42%, down 1.45 percentage points year-on-year. The sales expense ratio was 4.12%, down 0.67 percentage points [9]. - The company benefited from a reduction in expense ratios due to increased sales revenue and ongoing cost-cutting measures [9]. Order Summary - The company signed new contracts worth 35.432 billion yuan in the first half of 2025, a year-on-year increase of 23.46%. The international contracts grew by over 200% [9]. - As of the end of Q2 2025, the contract liabilities reached 7.399 billion yuan, reflecting a year-on-year increase of 56.5% [9]. Future Outlook - The company is expected to achieve a net profit of approximately 8.5 billion yuan in 2025, corresponding to a price-to-earnings ratio of about 20.5 times [9].

Investment Rating - The investment rating for the company is "Outperform the Market" [6][24]. Core Views - The company has shown steady revenue and profit growth, with a significant increase in overseas and external network business [1][2]. - The company achieved a revenue of 24.243 billion yuan in the first half of 2025, representing a year-on-year increase of 19.54%, and a net profit of 2.952 billion yuan, up 8.82% year-on-year [1][8]. - The company is experiencing rapid growth in smart grid and low-carbon energy businesses, with smart grid revenue reaching 12.225 billion yuan, up 28.37% year-on-year [2][22]. - The company has signed new contracts worth 35.432 billion yuan, a year-on-year increase of 23.46%, with over 50% of contracts coming from outside the State Grid [2][23]. Summary by Sections Financial Performance - In the second quarter of 2025, the company reported a revenue of 15.348 billion yuan, a year-on-year increase of 22.50%, and a net profit of 2.272 billion yuan, up 7.33% year-on-year [1][22]. - The gross margin for the first half of 2025 was 26.45%, down 2.58 percentage points year-on-year, while the net margin was 12.89%, down 1.38 percentage points year-on-year [1][8]. Business Segments - The company’s smart grid revenue was 12.225 billion yuan, with a gross margin of 30.34%, while low-carbon energy revenue reached 6.541 billion yuan, with a gross margin of 21.59% [2][22]. - The overseas revenue saw a remarkable increase of 139% year-on-year, contributing to 46% of the total revenue from external networks [2][23]. Future Outlook - The company plans to distribute a mid-term dividend of 0.147 yuan per share, totaling 1.175 billion yuan, which accounts for 45.72% of the net profit for the first half of the year [2][23]. - The profit forecast for 2025-2027 has been adjusted to 8.369 billion yuan, 9.462 billion yuan, and 10.716 billion yuan respectively, with the current stock price corresponding to PE ratios of 21, 19, and 17 times [24][26].

Core Viewpoint - China's High Voltage Direct Current Transmission System (HVDCS) has become a core technology for building a new energy system, leveraging its advantages in long-distance and high-power transmission. The market for HVDC is projected to reach 89.2 billion yuan in 2024 and exceed 300 billion yuan by 2028, driven by the expansion of wind and solar power installations and the explosive demand for AI computing power [1][7]. Industry Overview - HVDCS utilizes direct current for high-power, long-distance electricity transmission, converting three-phase alternating current to direct current and back again, enabling efficient and stable energy transfer [2]. - The industry has developed a complete upstream and downstream industrial system, focusing on raw materials, equipment manufacturing, and system integration, with major investments from state-owned enterprises [4]. Market Size and Growth - The HVDC market in China reached 89.2 billion yuan in 2024, a 42.3% increase year-on-year, and is expected to surpass 300 billion yuan by 2028 [7]. - The demand for 800V HVDC technology is anticipated to surge, particularly in the context of AI data centers, with the market projected to grow from 2 billion yuan in 2028 to 6.4 billion yuan by 2030, reflecting a compound annual growth rate of 47% [1][8]. Industry Chain - The HVDCS industry chain includes upstream raw materials, midstream equipment manufacturing, and downstream operation by major power grid companies, facilitating large-scale applications in long-distance transmission and renewable energy integration [4]. Competitive Landscape - The industry is characterized by a concentration of market share among state-owned enterprises like China Xidian and TBEA, while private companies and foreign firms compete in niche areas [10]. - China Hengtian Electric holds a 28% market share, benefiting from partnerships with leading internet companies in the AI data center sector [10]. Development Trends - The industry is expected to see technological advancements, with a shift towards 800V high-voltage platforms and silicon carbide devices, enhancing system efficiency and reliability [11]. - The application scenarios for HVDC are diversifying, including cross-border energy interconnections and industrial microgrids, creating a multi-billion market for related services [12]. - Chinese HVDC companies are transitioning to a global operational model, focusing on technology, standards, and capital, with exports expected to rise to 40% by 2030 [13][14].

Core Viewpoint - The article discusses the quarterly review changes of the FTSE China A50 index announced by FTSE Russell, highlighting the inclusion and exclusion of specific stocks and the implications for investment funds tracking the index [5][6]. Group 1: Index Changes - Four stocks, including BeiGene, NewEase, WuXi AppTec, and Zhongji Xuchuang, will be added to the FTSE China A50 index, while China Nuclear Power, China Unicom, Guodian NARI, and Wanhua Chemical will be removed [5]. - The newly added stocks belong to the innovative drug and CPO sectors, while the removed stocks are from traditional industries such as utilities and telecommunications [5]. - The newly included stocks have shown significant price increases this year, with NewEase and Zhongji Xuchuang rising over 200%, and BeiGene and WuXi AppTec around 90% [5]. Group 2: Market Impact - The estimated size of passive funds tracking the FTSE China A50 index exceeds $10 billion, indicating that changes in constituent stocks can lead to substantial capital flows, potentially in the hundreds of millions to billions [5]. - Investors have raised concerns about the inclusion of stocks perceived as overvalued and whether this adjustment is a strategy for foreign capital to take over high-priced stocks [6]. - The adjustment is based on market capitalization and liquidity criteria, with the review conducted quarterly, using data from the third Friday of February, May, August, and November [6].

Market Performance - The grid equipment sector increased by 3.01% compared to the previous trading day, with Xin Fengguang leading the gains [1] - The Shanghai Composite Index closed at 3812.51, up 1.24%, while the Shenzhen Component Index closed at 12590.56, up 3.89% [1] Individual Stock Performance - Xin Fengguang (688663) closed at 37.08, up 15.05% with a trading volume of 138,400 shares and a transaction value of 494 million [1] - Songsheng Co., Ltd. (301002) closed at 31.83, up 13.80% with a trading volume of 118,400 shares and a transaction value of 360 million [1] - Other notable performers include: - Buyao Maintenance (605196) at 24.98, up 10.00% [1] - Southern Power Technology (688248) at 44.48, up 9.15% [1] - Yantu Network (835508) at 32.94, up 9.11% [1] Capital Flow Analysis - The grid equipment sector saw a net inflow of 1.073 billion in main funds, while retail funds experienced a net outflow of 552 million [2][3] - The main funds' net inflow for notable stocks includes: - TBEA (600089) with a net inflow of 411 million [3] - Far East Holdings (600869) with a net inflow of 128 million [3] - Guodian NARI (600406) with a net inflow of 82 million [3]

Core Viewpoint - The financial performance of A-share listed companies in Nanjing for the first half of the year shows strong growth, particularly in the banking and securities sectors, driven by their focus on serving the real economy and innovation in technology [1][2][3]. Financial Performance - Nanjing's A-share listed companies have a total market capitalization of approximately 1.81 trillion yuan, with Jiangsu Bank, Nanjing Bank, and Huatai Securities leading in net profits of 20.24 billion yuan, 12.62 billion yuan, and 7.55 billion yuan respectively [1][2]. - Jiangsu Bank reported a revenue of 44.86 billion yuan, an increase of 7.78% year-on-year, and a net profit growth of 8.05% [2]. - Nanjing Bank achieved a revenue of 28.48 billion yuan, with a year-on-year growth of 8.64%, and a net profit increase of 8.84% [2]. - Huatai Securities saw a revenue of 16.22 billion yuan, with a significant year-on-year increase of 31.01%, and a net profit growth of 42.16% [2]. Service to Real Economy - Jiangsu Bank's focus on supporting manufacturing and infrastructure projects led to a manufacturing loan balance of 360.6 billion yuan, growing by 18.90% year-on-year, and infrastructure loans reaching 691.2 billion yuan, up by 31% [3]. - Nanjing Bank emphasized service to key industries, with green finance, inclusive small and micro finance, and technology finance loans growing by 27.79%, 12.51%, and 12.42% respectively [3]. - Huatai Securities maintained a strong development trend by innovating its business and service models [3]. Innovation and Technology - Nanjing Steel's half-year report highlighted a net profit of 1.46 billion yuan, with advanced steel material sales contributing significantly to profits [4][5]. - Nanjing Steel's innovation strategy included breakthroughs in advanced steel materials and participation in national key research projects [5]. - Guodian NARI's report showcased its technological advancements, achieving a revenue of 24.24 billion yuan, up by 19.54% year-on-year, and a net profit of 2.95 billion yuan, growing by 8.82% [6]. Globalization Strategy - Companies like Maolai Optical and Nanwei Medical are leveraging globalization for growth, with Maolai Optical reporting a revenue of 319 million yuan, up by 32.26%, and a net profit increase of 110.36% [7][8]. - Nanwei Medical achieved a revenue of 1.565 billion yuan, with overseas revenue accounting for 58% of total income, reflecting its global expansion efforts [9].

Core Viewpoint - Nanjing has four companies among the nine listed in Jiangsu with a market capitalization exceeding 100 billion yuan, highlighting the city's strong financial performance and contribution to the regional economy [1]. Financial Performance of Nanjing Companies - Nanjing's A-share listed companies reported a total market capitalization of approximately 1.81 trillion yuan, with Jiangsu Bank, Nanjing Bank, and Huatai Securities leading in net profits of 202.38 billion yuan, 126.19 billion yuan, and 75.49 billion yuan respectively [1][2]. - Jiangsu Bank achieved a revenue of 448.64 billion yuan, an increase of 7.78% year-on-year, and a net profit growth of 8.05% [3]. - Nanjing Bank reported a revenue of 284.8 billion yuan, up 8.64%, and a net profit of 126.19 billion yuan, reflecting an 8.84% increase [2]. - Huatai Securities recorded a revenue of 162.19 billion yuan, with a year-on-year increase of 31.01%, and a net profit of 75.49 billion yuan, up 42.16% [2]. Focus on Serving the Real Economy - Jiangsu Bank's focus on supporting the manufacturing sector led to a manufacturing loan balance of 360.6 billion yuan, growing 18.90% year-on-year, and infrastructure loans increased by 31% to 691.2 billion yuan [3]. - Nanjing Bank emphasized service to key industries, with significant growth in green finance, inclusive small and micro finance, and technology finance [3]. - Huatai Securities maintained a strong development trajectory by innovating its business and service models [3]. Innovation and Technology Leadership - Nanjing Steel's report highlighted a 18.63% increase in net profit, driven by advanced steel material sales contributing significantly to profits [4]. - Nanjing Steel's R&D investments focused on overcoming technological bottlenecks in advanced materials, leading to notable achievements in product development [4]. - Guodian Nari's innovations included the development of a domestic complete set of equipment for speed regulation and energy management systems, resulting in a revenue increase of 19.54% [5]. Globalization Strategy - Companies like Maolai Optical have successfully implemented globalization strategies, achieving a revenue of 3.19 billion yuan, a 32.26% increase, and a net profit growth of 110.36% [6][7]. - Nanwei Medical's overseas revenue now accounts for 58% of total income, reflecting its commitment to global expansion [8][9].

Summary of Conference Call Records Industry Overview: Power Equipment Key Points on Domestic and International Demand - The acceleration of ultra-high voltage (UHV) project approvals is expected, with multiple AC lines approved in the second half of the year, significantly higher than the first half. The total investment for the Shaanxi to Henan and Nanjing to Sichuan projects exceeds 30 billion yuan [1] - The investment budget for distribution networks is projected to grow by approximately 5% in 2025, focusing on smart technology, replacement of old equipment, and energy-saving renovations. Investment in grid intelligence is expected to increase by 60% year-on-year [1][5] - The European power market is seeing substantial investment in grid upgrades, with the EU planning to invest 584 billion euros by 2030, with one-third for transmission and two-thirds for distribution [1][7] Core Insights and Arguments - The approval of UHV projects is expected to increase from 2-3 AC lines in 2024 to 4-5 in 2025, indicating a significant growth trajectory [4] - The regional joint procurement in the distribution network sector has pressured the gross margins of leading companies by about 10 percentage points, but it has also increased market share for companies like XJ Electric, Samsung Medical, and Oriental Electronics [5] - The demand for low-voltage transformers and UHV equipment in Europe is rising, with Chinese manufacturers having advantages in conversion efficiency and power density [8] Company-Specific Developments - **Pinggao Electric**: New order growth of approximately 15% in the first half of 2025, with a significant increase in UHV GIS delivery expected from 2026 [11] - **China XD Electric**: Improved gross margins through cost management, with a projected delivery of 30-40 billion yuan in UHV projects for the year [12] - **XJ Electric**: Anticipates a significant increase in delivery volume for UHV products in 2026, with current orders exceeding 3 billion yuan [13] - **Siyuan Electric**: Actively expanding in the North American data center market, with a projected net profit growth of about 30% for 2025 [15] - **Samsung Medical**: Achieved a 124% year-on-year increase in overseas distribution network orders, with a projected net profit growth of 10-15% [16] - **Huaming Equipment**: European market contributes 50% of overseas revenue, with a projected net profit growth of about 15% [17] - **Guodian NARI**: Strong performance in the low-carbon energy sector, with expected revenue growth of 14-15% [18] - **Sifang Co.**: Domestic business exceeded expectations, with a 15% growth in main network orders [19] Other Important Insights - The focus on smart grid investments is expected to reshape the competitive landscape in the distribution network sector, benefiting leading companies in the medium term [5] - The North American market is experiencing tight supply for transformers and switches, creating significant opportunities for domestic companies [9] - The overall trend in the power equipment industry indicates a shift towards intelligent and sustainable solutions, aligning with global energy transition goals [10]